Wesfarmers Sustainability Report 2011 Wesfarmers Sustainability 2011 Report Contents Message from the Chairman 2 Managing Director’s welcome 2 Year in review 4 Wesfarmers response to Queensland floods 8 Sustainability scorecard 10 Reconciliation Action Plan 26 Coles 28 Home Improvement and Office Supplies 34 Target 44 Kmart 48 Insurance 52 Resources 56 Chemicals, Energy and Fertilisers 60 Industrial and Safety 64 About this report 68 Independent Assurance Statement 70 Glossary 72 Group structure and feedback form 73

ABOUT WESFARMERS Strength through diversity. From its origins in 1914 as a Western Australian farmers’ cooperative, Wesfarmers has grown into one of Australia’s largest listed companies. Headquartered in Western Australia, its diverse business operations cover: supermarkets; department stores; home improvement and office supplies; coal mining; insurance; chemicals, energy and fertilisers; and industrial and safety products. Wesfarmers is one of Australia’s largest employers and has a shareholder base of approximately 500,000. Our objective Wesfarmers remains committed to providing a satisfactory return to shareholders. Proud history, strong future Steeped in a foundation of distribution and retailing since its formation, today Wesfarmers is one of Australia’s leading retailers and diversified industrial companies. Stock exchange listing Wesfarmers is a company limited by shares that is incorporated and domiciled in Australia. Australian Securities Exchange (ASX) listing codes: – Wesfarmers (WES) – Wesfarmers Partially Protected Shares (WESN)

Wesfarmers Arts Indigenous Fellowships In July 2010, the National Gallery of Australia and Wesfarmers launched Australia’s first visual arts management fellowship for indigenous Australians. Attracting a national pool of applicants, the program provides 12 short-term scholarships every year, and two senior Fellowships worth $50,000 each, enabling recipients to work with the mentorship and the collections of the National Gallery for up to two years on a project of their choice.

Cover: Emma Loban with Ron Bradfield Jnr From left: Sharyn Egan (WA); Jirra Harvey (Vic); Franchesca Cubillo, Senior Curator Aboriginal and Torres Strait Islander Art, National Gallery of Australia; Kimberley Moulton (Vic); Emma Loban (Torres Strait Islands); Gabriel Nodea (WA); Glenn Iseger-Pilkington (WA); Ron Bradfield Jr (WA); Alison Furber (NT); Nadeena Dixon (NSW); Tahjee Moar (NSW); Freja Carmichael (Qld); and Renee Johnson (SA).

WESFARMERS LIMITED ABN 28 008 984 049

WESFARMERS SUSTAINABILITY REPORT 2011 Committed to sustainability. Wesfarmers is focused on improving its social, environmental and economic performance for the benefit of all its stakeholders.

Wesfarmers sustainability RepoRt 2011 1 Message Managing Director’s from the welcome Chairman

With operations that are far-reaching and complex, keeping focused on our economic, environmental and social performance is critical to delivering on our objective of providing value to all our stakeholders.

The scope and diversity I’m very pleased to welcome you to the Fundamental to our success – and of the Wesfarmers Group 2011 Wesfarmers Sustainability Report. therefore our value – are the people within our business. As Australia’s largest private confers on us an enormous As I reflect on the past year and the sector employer, we invest millions of challenges and opportunities in our responsibility, not only to dollars not only in wages, but training businesses, it reminds me once again our shareholders, but also and development too. However, it is the about the true value of sustainability. safety of our people which is – and must to our 200,000 employees, With operations that are far-reaching be – our most important focus. Tragically, our wider customer base, and complex, keeping focused on our in August last year a contract worker at and the communities and economic, environmental and social one of our mines was fatally injured in a performance is critical to delivering on families across Australia, single vehicle accident. In the most awful our objective of providing value to all New Zealand and Asia of circumstances we are reminded about our stakeholders. where the company operates. the importance of safety. As an organisation, Importantly, sustainability within the providing a safe work environment is both Wesfarmers Group isn’t simply an ‘add-on’. Safety must be fundamental our responsibility and our obligation – Stakeholder expectations have evolved everybody has the right to return home to every aspect of our diverse well beyond purely the financial success safely each day. While all of our businesses businesses, and that’s a of an organisation, but Wesfarmers has prioritise and focus on safety, we can and message we must never long recognised the value and opportunity must do better. of a holistic approach to managing our stop communicating. Climate change remains at the forefront operations. For us, sustainability isn’t just of public debate and in July this year a public relations exercise while the ‘real’ the Federal Government announced its business goes on regardless. As you will Clean Energy Legislative Package. We see in this report – and indeed in all earlier have continued to work cooperatively and such reports – the detail of investing in and collaboratively with government and have improving our operations all contributes to Bob Every Chairman contributed where relevant to the debate. the sustainability of our business as a whole. Indeed, Wesfarmers has long held the This is the fourteenth year we have view that climate change is one of the published such a report and our businesses most significant issues facing not only our are all doing some terrific things to initiate business, but our community as well. While positive change within their operations. I think it is important to contribute to the But there is progress to be made in many broader policy debate on the issue, we areas as well, and we remain committed to must also continue to focus on what our reporting our sustainability outcomes in a businesses can do to minimise their carbon frank and transparent way. As a Group, we footprint. All of our businesses are taking are developing a sustainability policy which steps to reduce carbon dioxide emissions will formalise what has been our long-held and improve energy efficiency. Coles, in view about running our businesses. The particular, has made significant inroads into policy encapsulates five key principles improving the energy efficiency of its stores, around which we prioritise our sustainability and our industrial businesses are looking for efforts: people; carbon and energy; opportunities to reduce their emissions with community partnerships; environmental direct abatements where feasible. Climate footprint; and economic development. You change certainly presents challenges for will see that each of our businesses report our business but we must also look to specifically on these areas, and we collate embrace the opportunities to innovate this data for reporting at a Group-wide level. for improvement.

2 Wesfarmers sustainability RepoRt 2011 Fundamental to our success – and therefore our value – are the people within our business.

Richard Goyder with works from the Wesfarmers Collection of australian art by artists from Maningrida, arnhem land in the northern territory.

At the time, in recognition of the scale of the disaster, Wesfarmers donated $5 million to the Queensland Premier’s Disaster Relief Appeal. We have a strong involvement with the people of Queensland – employing nearly 40,000 people there – many of whom were affected either directly or indirectly by this disaster. New Zealand also experienced disaster on a huge scale, with earthquakes in Christchurch devastating that city. Once again, watching from afar we felt for the people of Christchurch especially, and made a NZ$1 million contribution to provide assistance to the many people affected. In both these events, the actions of our team members in providing assistance to those in need were remarkable. Both were devastating events, but the aftermath demonstrated the resilience and generosity of the Australian and New Zealand people. Once again, I’d like to extend my thanks to all our employees for their efforts over the past year, many of which have been captured in some way in this report. As One of the areas I feel passionately about We continued to participate in the Jawun always, we’d love to hear from any of our for our business is our relationship and Indigenous Corporate Partnerships stakeholders, and we have included a form involvement with Aboriginal and Torres Strait program, with a number of employees on the inside back cover for this purpose. Islanders. In November 2009, we launched involved in the secondment program from our first Reconciliation Action Plan, and across the Group. We have also broadened pleasingly, we continue to take small but our community partnerships program significant steps towards reaching our goals. and now have a number of significant Each of our businesses has developed an partnerships with Aboriginal organisations Aboriginal strategy focusing on providing across Australia. employment initiatives, along with raising Notwithstanding all of the above, however, Richard Goyder Managing Director cultural awareness in respect to Aboriginal two other events unfolded over the past year people. In November 2010, we launched which helps to put our business operations the Wesfarmers Arts National Indigenous in perspective. In early 2011, devastating Fellowships at the National Gallery of floods affected hundreds of thousands of Australia. This annual program sees people, principally in Queensland but also 12 young and emerging indigenous curators in Victoria. Tragically, lives were lost and, from across Australia awarded scholarships like many other Australians, our deepest to work intensively with the curators and sympathy went out to family and friends, collections at the National Gallery, in a as well as those who lost homes and long-term professional development and businesses. museum industry mentoring program. This initiative is the first of its kind in Australia.

Wesfarmers sustainability RepoRt 2011 3 Year in review

This section provides comparative information on our performance in key sustainability areas.

REtail Coles Greenhouse gas emissions Energy use Water consumption

tonnes Co2e petajoules Megalitres

2011 2,523,808 2011 7.27 2011 2,983 2010 2,530,856 2010 7.39 2010 2,709 2009 2,978,518 2009 7.29 2009 2,170 2008 2,938,829 2008 7.02 2008 1,725 2007 n/a 2,523,808 2007 n/a 7. 27 2007 n/a 2,983

Safety performance Community contribution lost time injury Frequency Rate a$m

2011 16.98 2011 22.31 2010 12.87 2010 9.17 2009 15.55 2009 19.72 2008 17.45 2007 n/a 16.98 22.31 – n/a means data was not available.

Bunnings Greenhouse gas emissions Energy use Water consumption

tonnes Co2e petajoules Megalitres

2011 226,184 2011 0.82 2011 732 2010 210,620 2010 0.77 2010 691 2009 179,046 2009 0.73 2009 717 2008 186,525 2008 0.69 2008 844 2007 182,802 226,184 2007 0.64 0.82 2007 858 732

Safety performance Community contribution lost time injury Frequency Rate a$m

2011 13.41 2011 26.37 2010 12.53 2010 20.09 2009 14.56 2009 15.53 2008 13.79 2008 12.50 2007 14.48 13.41 2007 8.00 26.37

4 Wesfarmers sustainability RepoRt 2011 Office Supplies Greenhouse gas emissions Energy use Water consumption tonnes Co2e petajoules Megalitres

2011 65,000 2011 0.21 2011 50 2010 63,362 2010 0.21 2010 52 2009 55,522 2009 0.17 2009 n/r 2008 n/r 2008 0.06 2008 n/r 2007 n/a 65,000 2007 n/a 0.21 2007 n/a 50 Safety performance Community contribution lost time injury Frequency Rate a$m

2011 12.17 2011 1.35 2010 11.95 2010 0.51 2009 12.30 2009 0.49 2008 10.40 2007 n/a 12.17 1.35 – n/a means data was not available. – n/r means data was not collected or recorded.

Target Greenhouse gas emissions Energy use Water consumption tonnes Co2e petajoules Megalitres

20111 244,995 2011 0.82 2011 311 2010 239,827 2010 0.84 2010 339 2009 219,858 2009 0.82 2009 n/r 2008 230,545 2008 0.76 2008 n/r 2007 n/a 244,995 2007 n/a 0.82 2007 n/a 311

Safety performance Community contribution lost time injury Frequency Rate a$m

2011 6.96 2011 3.12 2010 7.97 2010 3.08 2009 9.20 2009 2.67 2008 9.34 2007 10.36 – n/a means data was not available. 6.96 3.12 – n/r means data was not collected or recorded.

1 includes Coles Group asia (714 tonnes Co2e).

Kmart Greenhouse gas emissions Energy use Water consumption tonnes Co2e petajoules Megalitres

2011 311,668 2011 1.08 2011 767 2010 303,397 2010 1.04 2010 775 2009 257,087 2009 0.99 2009 n/r 2008 310,391 2008 1.05 2008 n/r 2007 n/a 311,668 2007 n/a 1.08 2007 n/a 767

Safety performance Community contribution lost time injury Frequency Rate a$m

2011 6.78 2011 11.31 2010 9.02* 2010 6.88 2009 11.18 2009 11.85 2008 10.74 2007 11.02 – n/a means data was not available. 6.78 11.31 – n/r means data was not collected or recorded. * Data adjusted due to reclassification of claims.

Wesfarmers sustainability RepoRt 2011 5 induStRial and othER BuSinESS Insurance Greenhouse gas emissions Energy use Water consumption

tonnes Co2e petajoules Megalitres

2011 12,789 2011 0.08 2011 80 2010 13,405 2010 0.08 2010 66 2009 12,236 2009 0.09 2009 119 2008 12,975 2008 0.08 2008 113 2007 5,679 12,789 2007 0.04 0.08 2007 n/r 80 Safety performance Community contribution lost time injury Frequency Rate a$m

2011 0.83 2011 0.44 2010 0.89 2010 0.96 2009 2.22 2009 0.84 2008 3.7 2007 2.7 0.83 0.44 – n/r means data was not collected or recorded.

Resources Greenhouse gas emissions Energy use Water consumption

tonnes Co2e petajoules Megalitres

2011 694,026 2011 4.00 2011 2,707 2010 715,388 2010 3.94 2010 3,402 2009 707,725 2009 4.31 2009 3,045 2008 614,619 2008 3.33 2008 3,654 2007 834,654 694,026 2007 3.51 4.00 2007 3,869 2,707 Safety performance Community contribution lost time injury Frequency Rate a$m

2011 1.29 2011 0.87 2010 2.14 2010 0.71 2009 2.53 2009 0.86 2008 7.2 2007 3.4 1.29 0.87

Chemicals, Energy and Fertilisers Greenhouse gas emissions Energy use Water consumption

tonnes Co2e petajoules Megalitres

2011 2,022,741 2011 18.25 2011 4,220 2010 2,024,587 2010 17.93 2010 4,143 2009 1,862,605 2009 15.16 2009 3,591 2008 1,811,792 2008 17.88 2008 3,630 2007 1,461,880 2007 14.59 2007 2,455 2,022,741 18.25 4,220 Safety performance Community contribution lost time injury Frequency Rate a$m

2011 4.59 2011 0.29 2010 3.82 2010 0.45 2009 2.60 2009 0.69 2008 4.05 – Data from 2007 to 2010 has been restated to 2007 1.83 reflect the merge of energy, and the Chemicals 4.59 0.29 and Fertilisers divisions in July 2010.

6 Wesfarmers sustainability RepoRt 2011 Industrial and Safety Greenhouse gas emissions* Energy use* Water consumption* tonnes Co2e petajoules Megalitres

2011 243,071 2011 1.21 2011 254 2010 30,014 2010 0.19 2010 63 2009 25,231 2009 0.19 2009 55 2008 33,546 2008 0.20 2008 n/r 2007 29,533 243,071 2007 0.18 1.21 2007 n/r 254 Safety performance* Community contribution* lost time injury Frequency Rate a$m

2011 2.34 2011 1.31 2010 1.61 2010 0.21 2009 2.4 2009 0.18 2008 4.6 2007 4.6 – n/r means data was not collected or recorded. 2.34 1.31 * 2011 data reflects the inclusion of Coregas in the industrial and safety division in July 2010.

WESfaRmERS GRoup Corporate Office Greenhouse gas emissions Energy use Water consumption tonnes Co2e petajoules Megalitres

2011 5,294 2011 0.01 2011 4 2010 1,353 2010 0.01 2010 3 2009 716 2009 0.01 2009 7 2008 n/r 2008 n/r 2008 n/a 2007 n/r 5,294 2007 n/r 0.01 2007 n/a 4 Safety performance Community contribution lost time injury Frequency Rate a$m

2011 0 2011 10.20 2010 0 2010 3.72 2009 4.85 2009 4.79 2008 0 – n/a means data was not available. 2007 0 0 10.20 – n/r means data was not collected or recorded.

Group Greenhouse gas emissions Energy use Water consumption tonnes Co2e petajoules Megalitres

2011 6,349,576 2011 33.75 2011 12,107 2010 6,132,809 2010 32.40 2010 12,243 2009 6,298,544 2009 29.76 2009 9,704 2008 6,139,222 2008 31.07 2008 9,966 2007 2,514,548 2007 18.96 2007 7,182 6,349,576 33.75 12,107 Safety performance Community contribution lost time injury Frequency Rate a$m

2011 12.78 2011 77.57 2010 10.95 2010 45.78 2009 13.06 2009 57.62 2008 9.94 2007 10.60 12.78 77.57

Wesfarmers sustainability RepoRt 2011 7 Queensland flood disaster – how Wesfarmers helped

During late December 2010 and early To ensure the ongoing availability of basic January 2011, Queensland experienced food items for the town of Emerald, a one of its worst flooding disasters in history. temporary store was established at the Sadly, these floods resulted in a large loss Emerald Police and Citizens Youth Club. of life, and thousands of homes, properties The temporary Coles stocked about and businesses were flooded as nearly 200 staple food and grocery lines and three-quarters of the state was declared operated from January until a new Coles a disaster zone. Emerald supermarket opened in June 2011. In the immediate aftermath of the tragedy, Wesfarmers donated $5 million to the as well as opening up Coles’ registers to Queensland Premier’s Disaster Relief customer donations, which raised more Appeal. In providing assistance to the huge than $4.3 million for the Queensland recovery program, Wesfarmers recognised premier’s disaster Relief appeal, many not only the scale of the disaster but the of the Queensland stores also came to severe and ongoing disruption caused to the aid of emergency service teams and the livelihoods of many people in that state. evacuation centres, donating essential With a large number of Wesfarmers’ retail, items such as water, toilet paper, bread, resources and insurance operations – milk and meat. including nearly 40,000 employees – located in Queensland, many of our businesses Bunnings’ response was also immediate also made significant contributions, some with Queensland team members providing of which are detailed here. support assisting local emergency service groups in sand bagging and running sausage Coles responded immediately with a sizzles for support teams. Queensland $1 million donation to the Premier’s Disaster team members also provided on the ground Relief Appeal. The floods (and subsequently assistance at evacuation centres, holding a cyclone) had a significant impact on the sausage sizzles for emergency services business in Queensland: Coles was forced and those displaced from homes, as well to close 23 supermarkets, 35 liquor stores, as running activities for children and adults 13 Coles Express sites and six hotels. throughout the day and night. With our usual major road and rail transport Bunnings stores across Australia and routes into Queensland cut off, it was New Zealand helped raise and contribute necessary to organise air and sea freight more than $730,000 to the Premier’s to make emergency food deliveries to the Disaster Relief Appeal through fundraising most affected areas. About 120 tonnes top: team members at the bunnings Craigieburn sausage sizzles and cash donations. Warehouse hold a fundraising sausage sizzle for of food were airlifted to service Cairns the Queensland flood appeal. and Townsville. One of our distribution Bunnings also committed a further

bottom: the target Country, emerald store opened centres for Queensland was flooded, $1 million in direct support for flood affected a temporary site to provide the community with making it inoperable. As a consequence, communities which was supported by necessities such as towels, bed linens, nappies we established a temporary facility and Bunnings team members assisting local and clothing to help with the recovery. re-routed deliveries from Sydney. More communities with clean-up work, as well as than 500 tonnes of food were sent to far long-term recovery and rebuilding efforts. At north Queensland by truck and more than the end of the 2010/11 financial year, more 700 tonnes sent by sea freight from Sydney than 700 community groups were assisted to service Cairns and Townsville. through donations and hands-on support from the Bunnings team.

8 Wesfarmers sustainability RepoRt 2011 In the immediate aftermath of the tragedy, Wesfarmers donated $5 million to the Queensland Premier’s Disaster Relief Appeal.

Main image: Coles, emerald. below: Coles, ipswich. bottom: blackwoods, bundaberg.

This work is ongoing and local teams Kmart assisted team members that Wesfarmers insurance paid flood continue to support community were affected through the provision of affected customers more than groups affected. accommodation and more than $60,000 in $39 million in claims to 30 June 2011. gift cards to replace damaged goods. Our Bunnings had a number of sites affected the response by team members to team members also raised an additional by the flooding which were forced to the disaster was not only as efficient $18,900 for fellow team members that were temporarily close. Rocklea and Oxley as possible, but their generosity affected. Our customers across Australia and Warehouses were significantly impacted through a salary sacrifice scheme New Zealand donated more than $230,000 and remained closed until March 2011. collected $20,000, which was matched and the Kmart business donated over Teams from these stores worked tirelessly by the business. in the clean-up and rebuild to ensure that $14,000 worth of supplies to local schools stores reopened in the quickest possible including back packs, sports equipment, electrical goods and stationery. In addition, Officeworks conducted fundraising time to support the local community in their activities for customers and team recovery efforts. Kmart contributed an estimated $100,000 in emergency goods to those in need. members, contributing more than Target was also affected by the floods. $100,000 in donations to the Premier’s A number of stores were inundated by the The damage caused by the flood waters Disaster Relief Appeal. Officeworks also flood waters, and were forced to temporarily also extended into central Queensland. provided free photocopying and scanning close. In Emerald, a temporary store was Notwithstanding the significant impact of insurance- related paperwork for established to ensure customers could the major flooding had on production at customers and donated gift cards and still access basic necessities. Target team Wesfarmers Resources’ Curragh coal mine, products to families whose back-to-school members who were affected were assisted Wesfarmers Curragh donated $50,000 supplies were lost in the disaster. to the Central Highlands Regional Council with a total of $46,000 worth of gift cards While the impact of the disaster will be felt and $5,000 towards car insurances. As Flood Appeal. The division also matched employee donations. for a long time by many people, making a business, Target donated $100,000 to a contribution to assist Queensland the Premier’s Disaster Relief Appeal and Our Industrial and Safety division donated rebuild and recover reflects Wesfarmers’ collected an additional $283,276 through $50,000 to organisations contributing to the commitment to its local communities. the generosity of customer donations. Queensland flood relief, donated products A number of Kmart and KTAS stores, and facilitated a further $870,000 in supplier as well as a distribution centre, were product donations. In addition, Wesfarmers either flooded or forced to close due to Industrial and Safety approached freight flood waters cutting off access for team companies for support to deliver donated members and customers. products to the local communities.

Wesfarmers sustainability RepoRt 2011 9 Sustainability scorecard

17%

Safety performance Lost Time Injury Frequency Rate

2011 12.78 The business unit reports outlined in this 2010 10.95

document include a significant amount An increase in our LTIFR compared to last year indicates that we must do more of information on the environmental, across the Group to improve safety. safety and health performance, product sourcing and community interaction across the business operations of the 3.5% Wesfarmers Group. Greenhouse gas emissions

Tonnes CO2e 2011 6,349,576 2010 6,132,809 There have been some changes to the treatment of data in this year’s report and these changes have been highlighted and explained. Energy efficiency investments in many of our businesses assist us in better This report is based on the Global Reporting Initiative (GRI), which is managing our greenhouse gas emissions. a widely-used, standardised sustainability reporting framework. The summarised performance of the Wesfarmers Group is contained in this section, and more detailed information on the divisions is available in their sections of this report. In addition, as noted through the report, available on our website including base data and other information, is our statement of assurance against the GRI criteria. 4.2% Wesfarmers focuses on operating its businesses for the long-term Energy use without the distraction of relatively short-term forecasts. In this sense Petajoules we set very few public targets for future performance in the area of 2011 33.75 sustainability, preferring to be judged on performance, but the listing of material issues for our businesses will guide the reader to those 2010 32.40 issues we believe are most important in the long-term. The increase in our energy use compared to last year is slightly lower than our business growth.

1.1%

Water consumption Megalitres

2011 12,107 2010 12,243

The decrease is largely due to reduced water use at the Curragh mine in Queensland as a result of the Queensland floods.

69.4%

target team Community contribution members volunteer A$m their time to pack essential items 2011 77.57 in buddy bags 2010 45.78 for the alannah and Madeline The significant increase is largely due to Foundation to provide to one-off contributions to assist with the children entering recovery from the Queensland floods emergency care. and New Zealand earthquakes.

10 Wesfarmers sustainability RepoRt 2011 In Focus: Energy efficiency

Coles’ greenhouse gas emissions held steady year on year, as energy efficiency initiatives such as night blinds on open refrigeration cases, helped to reduce night-time energy use.

other divisional highlights:

Bunnings Kmart officeworks industrial and Safety target

Continued roll-out of New trials to reduce Implementation of a energy efficient lighting the amount of energy Making better use pilot project for efficient Changing the store initiatives to stores consumed in stores of available electricity warehouse lights temperature settings This included 29 stores Kmart will soon After a successful trial, Successfully piloted Target started a fitted with energy trial energy efficient power-factor correction energy efficient program to adjust efficient e-tronic lights initiatives including devices are now warehouse lights store temperature and the introduction using the sun to standard in new store that meet light quality settings by between of LED lighting in provide light; installing design specifications. requirements while one and two degrees, outdoor areas as a more energy efficient being cost effective. reducing energy standard in the new lighting; monitoring consumption. store design brief. and controlling where and when energy is used; using natural ventilation; and making air conditioning systems more efficient.

Wesfarmers sustainability RepoRt 2011 11 In Focus: Packaging

Wesfarmers is a signatory to the Australian Packaging Covenant (APC), a voluntary initiative aimed at reducing the effects of packaging on the environment. The first Action Plan was signed in March 2011.

other divisional highlights:

Coles target Bunnings Kmart 60% 1,800 63 of store waste 100% products assessed tonnes saved diverted from landfill recycled material More than 1,800 Target developed 60% of all store- Kmart will begin Coles-branded sustainable packaging generated waste was offering reusable products assessed guidelines for key diverted from landfill, shopping bags made against the APC’s merchandise areas, and Western Australian from 100 per cent sustainable packaging such as footwear, stores began recycling recycled material, guidelines. which saved 63 tonnes polystyrene packing rather than using of excess packaging. by backloading to their virgin plastic. distribution centre.

12 Wesfarmers sustainability RepoRt 2011 Economic contribution Environmental Wesfarmers is one of Australia’s largest publicly-listed companies Wesfarmers’ diversified businesses, and its geographical spread and one of the country’s largest private-sector employers, across Australia and New Zealand, means the company is with more than 500,000 shareholders and approximately responsible for managing a wide range of environmental issues. 200,000 employees at the report date. Because of this diversity, Wesfarmers requires business units to develop policies and procedures that are relevant to their particular As a result, both directly and indirectly, there are many Australians circumstances while ensuring that these are in line with the broader with a shared interest in the sustainable future of Wesfarmers Group’s principle of placing strong emphasis on protection of and our capacity to continue to provide satisfactory returns the environment. Across the Group, a number of significant to shareholders. environmental programs are being developed and implemented, many of which are outlined in the respective divisional reports. Group environmental indicators The information in this section includes data from five years wherever possible. Some of our businesses find that water and $11,449 m waste are difficult to accurately measure because of the shared Value added by Wesfarmers location of their facilities, so they have developed estimation techniques, while some of the former Coles group of companies did not collect some of this data prior to being acquired by Wesfarmers in November 2007. These estimations or lack of Our major operating business interests in the full-year covered by recorded data are highlighted in the report. this report include supermarkets, liquor and convenience stores; Greenhouse gas emissions home improvement and office supplies; general merchandise and Wesfarmers reports under the National Greenhouse and Energy apparel; coal mining; insurance; industrial and safety products Reporting Act 2007 (NGER Act). This system records the majority distribution; chemical and fertiliser manufacture; and gas of Australia’s greenhouse emissions and energy use. Wesfarmers production and distribution and power supply. registered under the NGER Act in October 2008 and operates a Key indicators of the Group’s financial performance indicators are Group-wide, internet-based, information management system to summarised in figure 1. manage our NGER Act reporting obligations, and also to inform and monitor our many energy efficiency programs in the future. Our operations make a significant contribution to the economies of Australia and New Zealand. These contributions included The NGER Act covers Scope 1 and 2 emissions; does not include more than $6,790 million paid in salaries, wages and other some significant emission sources such as the sodium cyanide benefits to our employees, dividends to our shareholders totalling business at our Kwinana operations or certain refrigerant gases; $1,735 million and $1,287 million paid to governments at all levels in and introduces the concept of operational control (which means, the form of taxes, levies and royalties. More than 95 per cent of our for example, a Coregas air separation unit in New South Wales revenues and earnings are derived from our Australian operations. and several remote power generators in Western Australia are reported for NGER Act purposes by our clients). This means that We are one of 20 Australian companies selected for inclusion in the some of our data is not directly comparable year on year, but Dow Jones Sustainability World Index for 2011 (as at 19 September where possible this is explained in the text and this report covers 2011). We are also included in the Dow Jones Sustainability World all emissions we are responsible for. Index and the Asia Pacific region (DJSI World – Asia Pacific). DJSI is a set of five indices which evaluate the performance of companies worldwide. The DJSI assessment (with assessments against the DJSI criteria) of Wesfarmers over the past five years has been shown in figure 2.

fIGUre 1: economic contribution ($m) fIGUre 2: Dow Jones sustainability World Index (%)

fY2009 fY2010 fY2011 dimension 2007 2008 2009 2010 2011 sales and operating revenue 50,982 51,827 54,875 environmental 55 51 67 72 78 Cost of goods, services etc 40,496 41,028 43,426 social 59 63 57 50 69 Value added by Wesfarmers 10,486 10,799 11,449 economic 63 64 69 71 62 Wages and salaries and other benefits 6,269 6,533 6,790 total for Wesfarmers 60 61 64 64 68 Dividends paid to shareholders 1,102 1,446 1,735 average in our industry group 41 46 47 45 48 interest paid on borrowings 816 616 472 income tax and other government payments 1,216 1,130 1,287 Reinvested in the business 1,072 1,036 1,111 Capital expenditure1 1,503 1,656 2,062 Depreciation and amortisation expense 856 917 923 1 Cash paid for purchases of property, plant and equipment and intangibles.

Wesfarmers sustainability RepoRt 2011 13 Sustainability scorecard continued

At the time of this report’s preparation, Wesfarmers recorded Our NGER Act report for 2010/11 reflected a decrease of

5,044,231 tonnes carbon dioxide equivalents (CO2e) (Scope 1 and 2.3 per cent, compared to the 2009/10 NGER Act report. 2 emissions) in our NGER Act report for 2010/11. This Sustainability Report declares a total of Scope 1, 2 and 3 emissions of

6,349,576 tonnes CO2e (a difference of 1,305,345 tonnes CO2e). The difference is created by the definitional and legal requirements of the NGER Act with the major components (all quoted as 6,349,576 approximate data in tonnes CO2e) comprising: (greenhouse gas emissions tonnes CO2e) • Scope 3 electricity transmission emissions (401,600) Scope 1, 2 and 3 • air travel emissions, calculated to include a forcing factor to account for emissions by aircraft at cruising altitude (38,200) The decrease in emissions this year (Scope 1 and 2 in the NGER • refrigerant gases excluded from the NGER Act (33,600) Act) occurred in most of our divisions – despite business growth • Air Liquide WA, which is reported under the NGER Act by across the Group – and resulted largely from: energy efficiency air liquide australia (89,000) investments in our retail businesses; the investment in nitrous • New Zealand and other country emissions (12,000) oxide emission reduction at CSBP in Kwinana (a business in the Chemicals, Energy and Fertilisers division), which is expected to • the sodium cyanide plants we operate for Australian Gold provide further reductions in direct emissions in future years; and Reagents (a 75 per cent owned joint venture) (82,600) – the reduction in production at our Curragh mine in Queensland, this production process is not included in the nGeR act which in turn reduced reported methane-based fugitive emissions Determination (the NGER Act requires this to be calculated according to a formula • the Coregas air separation unit at Port Kembla, New South driven by coal mined). Wales, which is deemed for nGeR act purposes not to be under the operational control of Coregas (197,700) Percentage of total Wesfarmers emissions • other emissions including gas transmission factors, use Coles 39.7 of rental vehicles and waste-related emissions and some WesCEF 31.9 industrial emissions not able to be recorded under the Resources 10.9 nGeR act (450,000). Kmart 4.9 Our total direct and indirect greenhouse emissions for the Group Target 3.9 in 2010/11 were 6,349,576 tonnes CO2e (figure 3). This was WIS 3.8 216,767 tonnes above emissions reported for last year; however, Bunnings 3.6 the 2010 data did not include air travel emissions or the Coregas Office Supplies 1.0 air separation unit at Port Kembla, which would have increased Insurance 0.2 the emissions reported in last year’s report by 235,900 tonnes to 0.3 per cent above the level reported this year. Corporate 0.1

fIGUre 3: Greenhouse gas emissions (tonnes CO2e)

2010 2011 2011 2011 division 2007 2008 2009 total Scope 1 and 24 Scope 35 total Coles n/a 2,938,829 2,978,518 2,530,856 2,148,630 375,178 2,523,808 bunnings 182,802 186,525 179,046 210,620 177,473 48,711 226,184 office supplies n/a n/r 55,522 63,362 55,938 9,062 65,000 target1 n/a 230,545 219,858 239,827 205,302 39,693 244,995 Kmart n/a 310,391 257,087 303,397 252,685 58,983 311,668 Resources 834,654 614,619 707,725 715,388 649,374 44,652 694,026 insurance 5,679 12,975 12,236 13,405 9,452 3,337 12,789 WesCeF2 1,461,880 1,811,792 1,862,605 2,024,587 1,875,740 147,001 2,022,741 Wis3 29,533 33,546 25,231 30,014 233,144 9,927 243,071 Corporate n/r n/r 716 1,353 1,301 3,993 5,294 Group total 2,514,548 6,139,222 6,298,544 6,132,809 5,609,209 740,082 6,349,576

– n/a means data was not available. 1 the target data includes Coles Group asia (714 tonnes Co2e). – n/r means data was not collected or recorded. 2 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the – Wesfarmers’ two joint ventures and a partly-owned company had combined scope 1 and 2 (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas.

emissions of 589,546 tonnes Co2e in 2009/10 on an equity basis (40% of bengalla coal mine 3 the Wis emissions increased in 2011 because of the inclusion of Coregas in that division from in new south Wales; 50% of Queensland nitrates pty ltd in Queensland; and 50% of Wespine July 2010. in Western australia) based on publicly available data for 2009/10. 4 the scope 1 and 2 data for 2011 includes all businesses where Wesfarmers has operational control

– an estimate of our transport supply chain emissions in australia and overseas is 760,000 tonnes Co2e. under the NGER Act; emissions related to our businesses in New Zealand, the United Kingdom and several asian countries; and, businesses we manage in australia (e.g. air liquide Wa) where we do not exercise operational control as defined by the nGeR act. 5 the scope 3 emissions for 2011 include electricity and gas transmission; liquid and gaseous fuel components; waste; rental vehicles; air travel emissions and some incidental sources. the scope 3 14 Wesfarmers sustainability RepoRt 2011 emissions increased in 2011 largely because of the inclusion of more elements. Wesfarmers continued to participate in the Carbon Disclosure Energy use Project (CDP) in 2011. Our submission is available on the CDP The total estimated energy use for our Group in 2010/11 was website at ww w.cdproject.n et and provides full disclosure on 33.75 petajoules, an increase of approximately 4.2 per cent on last our greenhouse emissions and our approach to climate change year, which is slightly lower than business growth. Our energy use issues. As part of our efforts to reduce emissions, we continue is summarised in figure 5. to contribute to a major emissions reduction initiative, the Coal21 Fund, which levies coal producers to fund research into low emission coal technologies. Our contribution to this fund is likely to reach $30 million over 10 years. The diversity of our business operations provides some difficulty 33.75 in developing Group-wide metrics to enable review of our (petajoules) emissions performance over time, other than the data provided in Energy consumed figure 3. Figure 4 shows our reported emissions per million dollars of revenue from the year 2001, which explains our capacity to improve emission intensity over time (in these 10 years there have been significant changes in the Group’s business activities). Wesfarmers is registered under the Federal Government’s Energy Efficiency Opportunities Act (EEO Act), with an amended We are also an investor in two joint ventures and a company Assessment and Reporting Schedule for our Group gaining in Australia which report under the NGER Act – the Bengalla regulatory approval in May 2010. The approved schedule mine in the Hunter Valley, New South Wales (40 per cent owned incorporates assessment of at least 92 per cent of all Wesfarmers by Wesfarmers and operated by Coal and Allied); Queensland energy use. Nitrates Pty Ltd at Moura in Queensland (50 per cent owned by Wesfarmers and operated as a separate management entity); We submitted our third public and government reports under and the 50 per cent owned Wespine sawmill in Western Australia. the EEO legislation in December 2010, and the public report Our equity share of the 2009/10 emissions (the most recent is available on our website at www.wesfarmers.com.au publicly available data) reported under the NGER Act by these The Group energy usage in our 2010/11 NGER Act report will be three businesses was 589,546 tonnes CO2e. The 2010/11 NGER different to the data in figure 5 below. The difference relates to legal Act reports by these businesses, and Wesfarmers Limited, will and definitional issues required by the NGER Act, and largely relates be published in February 2012. to: natural gas passed through our Kleenheat LPG operations at Kwinana, Western Australia, which is not actually converted to product or combusted, but which has to be counted in the NGER Act report (12.84 petajoules); and the enGen remote area power stations which are not under our operational control for NGER Act purposes and therefore are reported by our mining company customers (3.57 petajoules).

fIGUre 4: Greenhouse emissions (CO2e) per $m revenue fIGUre 5: energy consumed (petajoules)

division 2007 2008 2009 2010 2011 2011 115. 8 Coles n/a 7.02 7.29 7.39 7.27 2010 118.3 bunnings 0.64 0.69 0.73 0.77 0.82 2009 128.4 office supplies n/a 0.06 0.17 0.21 0.21 target n/a 0.76 0.82 0.84 0.82 2008 189.3 Kmart n/a 1.05 0.99 1.04 1.08 2007 271.6 Resources 3.51 3.33 4.31 3.94 4.00 insurance 0.04 0.08 0.09 0.08 0.08 2006 310.8 WesCeF1 14.59 17.88 15.16 17.93 18.25 2005 316.4 Wis2 0.18 0.20 0.19 0.19 1.21 Corporate n/r n/r 0.01 0.01 0.01 2004 265.4 Group total 18.96 31.07 29.76 32.40 33.75 2003 313.6 – n/a means data was not available. 2002 239.7 – n/r means data was not collected or recorded. – this data includes all energy use that is within the scope of this report except joint ventures we do not operate and the energy use 2001 376.8 associated with air travel emissions. 1 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas. 2 Wis energy consumed increased because of the inclusion of Coregas in that division from July 2010.

Wesfarmers sustainability RepoRt 2011 15 Sustainability scorecard continued

Water consumption During the year, our businesses disposed of 147,140 tonnes of Estimated water use (scheme, surface and ground water) across waste to landfill and the Group data is presented in figure 7. This the Group totalled 12,107 megalitres (figure 6). Last year’s is a 7.7 per cent increase on waste disposal compared to last year. estimated total Group consumption was 12,243 megalitres. The data is materially complete with only data from the Insurance The reported decrease is largely due to reduced water use division not included, largely because of the difficulty in measuring at our Curragh mine in Queensland, mainly as a result of the waste disposal at many small offices, many sharing facilities with Queensland floods. other organisations. In some of the business unit reports there are comments on many of the waste reduction and recycling initiatives undertaken across the Group. As a result of these programs and initiatives, our retail businesses recycled more than 206,000 tonnes of consumer 12,107 packaging materials during the year. (megalitres) Liquid waste data is difficult to collect for most of our facilities Total water usage because it is represented by unmetered discharges to public sewerage systems and in some cases liquid wastes delivered to appropriate treatment plants. Our coal mines also discharge Our total water use included 2,255 megalitres of ground water ground and rain water from their mine voids under licence with the (largely at our mine sites and industrial operations); 1,745 megalitres relevant authorities. CSBP at Kwinana, Western Australia, has a of treated water from recycled sewage waters at CSBP’s chemical discharge licence to a treated waste water system that eventually manufacturing operations at Kwinana and 1,575 megalitres of discharges to the Indian Ocean. surface water harvested at our mine sites. Non-compliance/prosecutions We are continuing to improve the accuracy of this data in the areas We are not aware of any significant non-compliance with where we estimate water use, particularly for retailers other than environmental regulations or any prosecutions relating to Bunnings, where shared facilities are common. environmental issues during the year other than disclosed in the various business reports. Waste All of our retail businesses are signatories to the Australian In total our businesses reported four potential or actual Packaging Covenant (APC) through the registration of Wesfarmers non-compliances with environmental licences or other regulatory Limited in 2010 – the APC replaced the previous National Packaging instruments (two each in WesCEF and Resources) and five Covenant (NPC) in which Wesfarmers and our retail businesses also exceedances of a target licence effluent concentration (but participated. The APC is, similar to the NPC, a voluntary packaging not a licence condition) at CSBP in Kwinana, Western Australia. waste reduction and recycling initiative underpinned by a National National Pollutant Inventory (NPI) Environment Protection Measure and all our retail businesses Resources and Chemicals, Energy and Fertilisers are required to reported publicly on their activities in October 2010 as our final report under the NPI. Full details are available on the NPI website report under the provisions of the NPC – this report is available ww w.npi.g ov. au, with 2010/11 data available in January 2012. at www.wesfarmers.com.au

fIGUre 6: Water consumption (megalitres) fIGUre 7: Waste disposal and recycling (tonnes) division 2007 2008 2009 2010 2011 2009 2009 2010 2010 2011 2011 Coles n/a 1,725 2,170 2,709 2,983 division disposed recycled disposed recycled disposed recycled bunnings 858 844 717 691 732 Coles 122,570 125,363 90,961 131,242 100,107 141,022 office supplies n/a n/r n/r 52 50 bunnings 19,898 9,150 17,936 14,488 17,991 9,419 target n/a n/r n/r 339 311 offices upplies n/r n/r 1,073 2,257 1,581 2,588 Kmart n/a n/r n/r 775 767 target 6,381 16,955 6,068 17,201 8,342 22,161 Resources1 3,869 3,654 3,045 3,402 2,707 Kmart 5,235 26,362 6,126 28,387 10,062 34,134 insurance n/r 113 119 66 80 Resources 960 2,162 869 2,251 1,083 459 WesCeF2 2,455 3,630 3,591 4,143 4,220 insurance n/r n/r n/r n/r n/r n/r Wis n/r n/r 55 63 254 WesCeF1,2 144,944 1,721 9,954 1,500 4,659 2,245 Corporate n/r n/r 7 3 4 Wis 3,103 659 3,645 543 3,252 591 Group total 7,182 9,966 9,704 12,243 12,107 Corporate n/r n/r n/r 13 63 20 – n/a means data was not available. Group total 303,091 182,372 136,632 197,882 147,140 212,639 – n/r means data was not collected or recorded. – n/a means data was not available. 1 the reduction in water use for the Resources division compared to 2010 was largely due to record – n/r means data was not collected or recorded. rainfalls in Queensland causing production disruptions and a reduced need for dust suppression. 1 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the 2 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas which from 2011 onwards is reported with Wis. which from 2011 onwards is reported with Wis. 2 the waste disposal by WesCeF decreased significantly in 2010 because the division concluded the soil disposal element of a complex contaminated site remediation in 2009.

16 Wesfarmers sustainability RepoRt 2011 In Focus: Ethical sourcing

99% of Bunnings timber products are now sourced from low-risk plantations or other verified legal or certified sustainable forest operations. More than 37% of these timber products are FSC certified.

other divisional highlights:

Coles industrial and Safety Kmart target

85 95 430 suppliers audited Improved auditing factories approved factory audits

85 suppliers operating Updated and improved 95 factories gained Conducted 430 in non-Organisation the supplier survey to approval through factory audits. Target for Economic manage risks in ethical Kmart’s Ethical completed a full review Co-operation and sourcing. Continued to Sourcing Code. of its Ethical Sourcing Development member work with international Kmart undertook a Code and business countries audited. suppliers to improve comprehensive review procedures including Coles’ approach is to the sustainability of of its ethical sourcing specification of our ensure suppliers of our sourced products, program, and will mutually recognised Coles-brand products which included auditing launch a new code codes. comply with its ethical all of our major Asian by the end of 2011. sourcing policy. suppliers of our own branded products.

Wesfarmers sustainability RepoRt 2011 17 In Focus: Wesfarmers in the community

The Wesfarmers Group contributed a total of $77.57 million in community support (including both direct and indirect activities). This is an increase of 69 per cent on last year, in part due to one-off contributions to the significant natural disasters that occurred during the year, as well as an increase in our general community partnerships.

other divisional highlights:

Kmart Coles Bunnings target Resources

5 million $26m Christmas gifts 7,600 contributed $1m Support for young distributed schools assisted and helped raise milestone reached people

More than five million $7 million of sporting Contributed and More than $1 million Continued support Christmas gifts equipment distributed helped raise more than raised for The for Life Education distributed over the to more than $26 million and our Alannah and Madeline Australia, delivering past 24 years through 7,600 schools across team supported well Foundation from the drug and alcohol the Kmart Wishing Australia as part of over 42,000 community sale of red re-usable education for young Tree Appeal. Coles’ Sports for activities through bags since Target’s people in central Schools program. sausage sizzles, partnership with the Queensland and south- hands-on DIY projects organisation started. west Western Australia. and renovations, local fundraising activities, community workshops and more.

18 Wesfarmers sustainability RepoRt 2011 Environmental expenditure During the year, Wesfarmers made some significant progress at Total environmental expenditure, including land remediation a site in Manjimup, Western Australia, formerly owned by Sotico. costs for 2010/11, is $34.96 million (figure 8). This compares with Extensive monitoring and review led to six properties owned by last year’s total of $53.92 million, the difference largely due to third parties near the site being reclassified as ‘Not Contaminated the completion of the Blackwater Creek diversion project at the – Unrestricted Use’ under the provisions of the Western Australian Curragh mine site. These costs include salaries and overheads, Contaminated Sites Act 2003 in August 2010. These properties specific environmental projects and any other costs (such as fees had previously been classified as Contaminated‘ – Remediation paid to consultants and capital expenses) for an environment- Required’ under the Act. The monitoring on the site, following the related purpose, which can include emission reduction, effluent extensive remediation activity reported last year, continues to show management, revegetation and energy efficiency. considerable positive progress. Monitoring and risk assessment continued variously at the former Wesfarmers Transport sites in Kewdale, Carnarvon and Port Hedland in Western Australia. The Carnarvon site was reclassified under the Contaminated Sites Act 2003 as ‘Remediated for restricted use’ in September 2010, which allows its intended use $34.96m to be pursued by the current owners. Remediation outcomes at Total environmental expenditure the Kewdale site have progressed to the stage where Wesfarmers will seek a similar regulatory outcome for that site in 2011/12.

Contamination Remediation of site contamination is an issue for some of our businesses. Wesfarmers is responsible for the remediation of several sites and financial provision has been made to cover the estimated cost of these activities. CSBP is engaged in the remediation of a former fertiliser site at Bayswater in Western Australia, which has been reported on previously. Active remediation has concluded at the site and activity now relates to monitoring and the statutory audit processes.

environmental Graduate ben Champion conducting water quality monitoring at blackwater Creek, Curragh mine, Queensland.

fIGUre 8: environmental related expenditure ($m) division 2007 2008 2009 2010 2011 Coles n/a 2.27 3.15 9.00 15.35 bunnings 5.32 6.84 10.00 4.12 4.67 office supplies n/a n/r n/r 0.02 0.08 target n/a 0.24 0.23 0.17 0.32 Kmart n/a n/r 1.28 1.59 2.16 Resources1 4.74 14.20 11.67 32.34 5.53 insurance n/r 0.13 0.24 0.21 0.01 WesCeF2 8.99 6.54 11.02 5.63 6.40 Wis n/r 0.04 0.06 0.20 0.20 Corporate 1.28 0.88 0.79 0.64 0.24 Group total 20.33 31.14 38.44 53.92 34.96

– n/a means data was not available. – n/r means data was not collected or recorded. – of the total expenditure on environmental and related matters, $4.62 million was required by regulation and $30.14 million was not required by regulation. 1 the large increase in 2010 relates to environmental facets and ecosystem offsets for the blackwater Creek project at the Curragh mine. 2 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas.

Wesfarmers sustainability RepoRt 2011 19 Sustainability scorecard continued

Social Given our autonomously operating business unit structure, Our people training is one of the key human resource issues within the direct The majority of our workforce is located in Australia and responsibility of business units. At the same time, key human New Zealand (see figure 9), and our employees worked capital development policies and processes apply across the more than 218 million hours (figure 10). Group. These include remuneration policies for the Group’s senior managers, workplace anti-discrimination and succession planning. Our recorded commitment in training and development was 2.2 million hours. We have a Code of Ethics and Conduct that covers employee behaviour and while business units are encouraged to adopt 199,364 standards that align best with their activities, these must embody Wesfarmers team members the principles laid down in the Group code, which is available on our website. Also available on our website is our Group Whistleblower Policy which encourages employees to raise any concerns and report instances of unethical, illegal, fraudulent In terms of workplace relations, we recognise the right of those or undesirable conduct, where there are reasonable grounds to we employ to negotiate either individually or collectively, with suspect such conduct, without fear of intimidation, disadvantage or without the involvement of third parties. The large majority or reprisal. of our employees are covered by collective agreements. At the same time, the company believes in maximising the flexibility of workplace arrangements available to employees and their managers. fIGUre 9: employee numbers in various locations A diverse workforce is of significant social and commercial value and Wesfarmers recognises the importance of being an inclusive employer. Gender diversity has been and continues to be a priority Asia for the Group. As at 30 June 2011, approximately 57 per cent of 444 our employees are female. Two of our eight non-executive directors (25 per cent), 22 per cent UK of Wesfarmers’ senior executives (general manager level or above), 156 and 26 per cent of all management and professional employees NT 1,965 across the Group are female. A copy of our diversity policy is QLD available on our website at www.wesfarmers.com.au 38,758 WA 23,834 SA 12,286 NSW 54,713

VIC 55,690 ACT NZ 2,542 5,614 TAS 3,362

fIGUre 10: Number of hours worked by employees division 2008 2009 2010 2011 Coles 104,317,176 111,464,731 110,744,686 109,973,384 bunnings 32,346,368 33,916,817 35,749,310 36,921,064 office supplies 5,884,429 6,257,964 6,613,388 6,984,777 target 20,246,165 20,664,453 20,204,521 21,110,499 Kmart 26,075,503 24,499,000 25,680,268 24,284,994 Resources 2,650,770 3,550,808 3,263,519 3,875,831 insurance 5,078,144 5,415,648 5,616,469 5,467,197 WesCeF1 4,169,727 4,253,030 3,841,739 3,488,097 Wis 5,817,131 5,829,832 5,600,947 6,407,312 Corporate 304,392 412,513 400,975 329,970 Group total 206,889,805 216,264,796 217,715,822 218,843,125 – this table includes 847,704 hours worked by the 429 employees in Coles Group asia. 1 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas.

20 Wesfarmers sustainability RepoRt 2011 In Focus: Greenhouse gas reduction

WesCEF started trials of nitrous oxide reduction technology using a catalyst, pictured, in one of its nitric acid plants at Kwinana (Western Australia) to help reduce greenhouse gas emissions.

other divisional highlights:

Chemicals, Energy Kmart Bunnings Resources Coles and fertilisers

Nitrous oxide reduction Focused on Improving 42 technology trialled Saving electricity use energy efficiency measurement stores

Nitrous oxide is a Introduced new Total carbon footprint Participating in a joint Installed voltage greenhouse gas technology and increased by 5%, government/industry optimisation emitted during the systems to only which remains 1% project to more technology in production of nitric recharge electric lower than net store accurately measure 42 stores, allowing acid. Each emitted forklifts when they growth due to store fugitive methane Coles to draw less unit is equivalent to fall below 25% energy efficiency emissions from coal energy from the public 310 units of carbon charge, hence saving initiatives. mining. It is expected grid and reduce dioxide, representing considerable electricity that a methodology total store power approximately 46% use and carbon will be agreed in 2012 consumption. of WesCEF’s total emissions. that we believe will

CO2e in 2009/10. reduce our reported emissions.

Wesfarmers sustainability RepoRt 2011 21 Sustainability scorecard continued

Safety Workplace safety remains the Group’s highest priority. We believe we have an obligation to do all we can to ensure the safety in the workplace of everyone who works for our company, our visitors and customers. Sadly, the death of a contract worker in a single light vehicle accident at the Curragh mine in August 2010 is a 9,334 reminder that we must continue to focus on preventing workplace Number of workers’ accidents. We have a Group target of reducing accident rates compensation claims by 50 per cent each year towards a goal of zero. The primary measures are the Lost Time Injury Frequency Rate (LTIFR) and the Total Recorded Injury Frequency Rate (TRIFR). Governance The corporate governance framework of Wesfarmers operates according to a series of governance charters and policies which have been adopted by the Board. A detailed account of the governance structure and responsibility of Wesfarmers Limited, including the role and responsibilities of the Board, can be found 12.78 in our 2011 Annual Report or in the corporate governance section Group LTIFR of the company’s website at www.wesfarmers.com.au Community contributions and partnerships The continuing successful operation of the Group’s businesses, in an ethical and socially responsible way, is the cornerstone of For the reporting period, the Group LTIFR was 12.78, up from our contributions to the community. We believe in supporting 10.95 for the previous year. Most of this reported increase was the communities in which we operate by direct and indirect due to a change in LTIFR calculation in Coles to standardise the assistance to organisations and activities that provide a public reporting definitions across the Group, although Bunnings and benefit. The Wesfarmers Board gives preference to activities WesCEF reported increases in LTIFR as well. The TRIFR at year focused on medical research and health, indigenous partnerships, end was 40.94, compared to 49.3 in July 2010, although some education and the Wesfarmers Arts program. In this report, further of this decrease is attributable to standardising our reporting of information on the Group’s response to the Queensland floods TRIs across the Group. is outlined in some detail. Reference is also made to the support There were 2,796 Lost Time Injuries (LTIs) over the year across all provided to the rebuilding efforts in Christchurch, New Zealand, businesses in the Group and 8,959 Total Recorded Injuries (TRIs), after major earthquakes. This crisis response was predominantly which include LTIs and medical treatment injuries. responsible for the increase in direct community support through cash donations by Wesfarmers Limited from $3.70 million in Details of individual business safety outcomes are found in 2009/10 to $10.19 million in 2010/11. figure 11 and their individual sections of this report. While the LTIFR remains the main Group-wide measure of safety performance currently, operating businesses are encouraged to use a range of broader measures to promote a more pro-active approach and support a culture of safe work practices. The number of workers’ compensation claims is shown in figure 12.

fIGUre 11: Lost Time Injury frequency rate (LTIfr) fIGUre 12: Workers’ compensation claims division 2007 2008 2009 2010 2011 division 2007 2008 2009 2010 2011 Coles1 n/a 17.45 15.55 12.87 16.98 Coles 5,546 5,547 5,482 5,474 6,112 bunnings 14.48 13.79 14.56 12.53 13.41 bunnings 1,331 1,068 1,304 1,258 1,080 office supplies n/a 10.40 12.30 11.95 12.17 office supplies 235 255 240 209 215 target 10.36 9.34 9.20 7.97 6.96 target 684 837 834 757 765 Kmart 11.02 10.74 11.18 9.02 6.78 Kmart 1,419 1,314 1,223 1,077 907 Resources 3.4 7.2 2.53 2.14 1.29 Resources 52 41 63 57 47 insurance 2.70 3.70 2.22 0.89 0.83 insurance 12 40 33 30 15 WesCeF2 1.83 4.05 2.60 3.82 4.59 WesCeF1 47 74 62 61 58 Wis 4.60 4.60 2.40 1.61 2.34 Wis 126 138 134 117 132 Corporate 0 0 4.85 0 0 Corporate 0 0 3 0 3 Group total 10.60 9.94 13.06 10.95 12.78 Group total 9,452 9,314 9,378 9,040 9,334 – n/a means data was not available. 1 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the 1 the Coles data has increased in the year in part due to a technical change in reporting (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas. methodology to ensure consistency across the Group. 2 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas.

22 Wesfarmers sustainability RepoRt 2011 In Focus: Safety

Wesfarmers Industrial and Safety piloted programs to improve forklift safety, such as driver training, introducing swipe card access, monitoring operator licences, fitting impact sensors, speed limits, and reporting.

other divisional highlights:

Kmart target Bunnings officeworks Chemicals, Energy and fertilisers

Improved manual 10,000 Improved safety Increased team Better safety initiatives handling training hours performance member participation

Introduced new Redesigned an More than 10,000 All Injury Frequency Increased focus on initiatives, such as existing carton hours dedicated to Rate reduced from safety metrics resulting boom gates and safety conveyor system which further train and up- 47.20 in 2009/10 to in increased team rails, to reduce the eliminated the need to skill Bunnings safety 36.22 this year. member participation potential for falls from manually push cartons improvement teams in safety meetings, Kmart loading docks. down the conveyor, to ensure they are risk assessments, reducing awkward effective in supporting task observations and reaching and twisting health and safety hazard identification by team members. onsite. in the workplace.

Wesfarmers sustainability RepoRt 2011 23 Sustainability scorecard continued

Figure 13 provides detailed data on our direct and indirect Wesfarmers Arts community partnerships and contributions during 2010/11. The award winning Wesfarmers Arts program provides major ongoing support to a number of premier Australian arts In 2010/11, our direct community contributions were 1.05 per cent companies. Wesfarmers’ sponsorship of the arts focuses on of earnings before interest and tax ($3.232 billion) and 1.76 per cent increasing community access to premier quality arts from Australia of net profit after tax ($1.922 billion). and the world in the belief that a vibrant cultural sector makes a To ensure consistent reporting on our Group community positive contribution to the lives of all Australians. contributions, Wesfarmers continued to engage with the London Highlights of the Wesfarmers Arts program included the first tour Benchmark Group (LBG). The LBG operates an assessment to regional Western Australia by the Australian Chamber Orchestra and verification process for organisations wishing to define their and the successful roll-out of the Wesfarmers Arts Indigenous community contributions according to standard definitions and Fellowships in partnership with the National Gallery of Australia. policies that are developed collaboratively by the LBG and its The only professional development and mentoring scheme of its members. More information about the process is available at kind in Australia, the Fellowships program provides opportunities the LBG website (ww w.lbg-australia.c om). for 12 indigenous Australians to work with the collections and professional staff of the National Gallery. In September 2011, the program was recognised by an Australian Business Arts Foundation Award for Innovation. In addition to the arts support program, the company’s nationally $77.57m recognised Collection of Australian Art is shared with the public Community contributions through exhibitions and loans to galleries across the country. Responsible sourcing While the majority of our expenditure on products, employee costs and services is in Australia and New Zealand, many of our LBG undertakes a verification process across the Wesfarmers businesses source products from other countries, predominantly Group (excluding Home Improvement and Office Supplies division) in Asia and India, but also from Europe, Africa and South America. and provides a report on which the data in figure 13 is based, In our industrial businesses, this sourcing is mainly complex as well as a verification statement on page 69. The community engineering products, bulk fertilisers and chemicals or other raw contributions from the Home Improvement and Office Supplies materials. One of these raw materials, phosphate rock (a key input (HIOS) division were assured by Net Balance as part of its overall for superphosphate manufacture) is from a mine in Western Sahara assurance of this report – please note its Assurance Statement on (where WesCEF buys about three per cent of the mine output) and page 70 for specific comment on HIOS’ community contributions. is the subject of international comment in relation to the status of the indigenous Saharawi people of the region. We have reported on this in previous reports and the WesCEF section of this report provides a brief update on our approach.

fIGUre 13: Community contributions ($m)

2009 2009 2009 2010 2010 2010 2011 2011 2011 division direct indirect total direct indirect total direct indirect total Coles 12.36 7.36 19.72 7.32 1.85 9.17 15.61 6.70 22.31 bunnings 3.61 11.92 15.53 2.03 18.06 20.09 3.28 23.09 26.37 office supplies 0.49 n/r 0.49 0.51 0 0.51 0.97 0.38 1.35 target 0.99 1.68 2.67 1.44 1.64 3.08 1.10 2.02 3.12 Kmart 1.02 10.83 11.85 2.35 4.53 6.88 0.74 10.57 11.31 Resources 0.86 n/r 0.86 0.68 0.03 0.71 0.83 0.04 0.87 insurance 0.84 n/r 0.84 0.96 0 0.96 0.41 0.03 0.44 WesCeF1 0.69 0 0.69 0.44 0.01 0.45 0.29 0.00 0.29 Wis 0.13 0.05 0.18 0.17 0.04 0.21 0.38 0.93 1.31 Corporate 4.78 0.01 4.79 3.70 0.02 3.72 10.19 0.01 10.20 Group total 25.77 31.85 57.62 19.60 26.18 45.78 33.80 43.77 77.57 – Direct contributions include cash, product at cost and in kind contributions at cost; indirect contributions are those made by others where a Wesfarmers business facilitated and supported the contribution, e.g. customer donations to an appeal at point of sale. – n/r means data was not collected in that year. 1 the WesCeF data for years prior to 2011 is an aggregation of the data previously reported for the (then) energy, and Chemicals and Fertilisers divisions – the data prior to 2011 includes Coregas.

24 Wesfarmers sustainability RepoRt 2011 Other businesses In addition to the businesses included in this report, Wesfarmers also holds major investments in the following companies. Queensland Nitrates Pty Ltd (QNP): Through WesCEF, Wesfarmers owns a 50 per cent interest in QNP, located at Moura in central Queensland. QNP is an ammonium nitrate producer and services the mining sector in the Bowen Basin. For further information, please visit ww w.dawsonvalley. n et/QNP Bengalla coal mine: Through our Resources division, In September 2011, Kmart ceased supply arrangements with an Wesfarmers owns a 40 per cent interest in the Bengalla coal Indonesian paper company to source envelopes shown to contain mine in the Hunter Valley in New South Wales, through a joint less than 20 per cent of tropical hardwood pulp. Kmart is now in the venture with Coal and Allied, a member of the Rio Tinto group process of reviewing similar paper products in light of these findings. of companies. The Bengalla mine produces steaming coal for Most of our sourcing of products from other countries is domestic and export markets. For further information, please undertaken by our retail businesses and Wesfarmers Industrial visit ww w.coalandallied. com .au and Safety. Each of these businesses has detailed policies and Gresham Partners Group Limited: Wesfarmers owns a codes that govern their responsible sourcing activities in other 50 per cent interest in Gresham Partners Group Limited, the countries, whether the sourcing is directly through manufacturers holding company for the Gresham Partners investment banking working for our businesses, or indirectly through other suppliers. activities. In addition, we are a participant in the Gresham Private These policies and codes are supported by extensive audit and Equity wholesale investment funds with underlying investments review systems conducted either by our businesses themselves, in mining services, retail, logistics and other specialist sectors. or through relying on mutual accreditation audit systems with For further information, please visit ww w.gresham. com.au other international retailers. Each business provides some detail BWP Trust: Wesfarmers owns 23.3 per cent of BWP Trust, on their approach to responsible sourcing in their section of this which develops and owns properties for our Bunnings business report and our progress in this area is regularly reported to the and other retail/commercial companies. For further information, Wesfarmers Board. please visit ww w.bwptrust. com.au At 30 June 2011 we had approximately 2,573 direct importers Wespine Industries: Wesfarmers owns 50 per cent of Wespine, across the Group and during the year 1,147 of these (44.6 per which operates a plantation softwood sawmill at Dardanup in cent) had been engaged in our verification or audit processes. Western Australia. After a good safety performance in recent A total of 1,377 audit processes were undertaken during the year, years, with no Lost Time Injuries (LTIs) recorded during the period of which 808 were completed either by our own staff or qualified September 2008 to September 2010, three LTIs were incurred in auditors acting directly for our businesses. The purpose of the the year to June 2011. audits is generally to check compliance and work with suppliers to rectify any issues found, but during the year one manufacturer Wespine purchases the majority of its raw material through its supplier to Target (and reported in Target’s section of this report) plantation log supply agreement with the Western Australian was deregistered due to poor social compliance. Forest Products Commission, which is in place until 2033, thus providing long-term resource security for the business. Political donations For further information, please visit ww w.wespine.c om.au Wesfarmers does not make donations to political parties. Sotico: Wesfarmers owns and operates Sotico Pty Ltd, which in 2010/11 had a large landholding of approximately 11,800 hectares at Boddington, Western Australia, where Sotico managed 3,300 hectares of pine plantation land and leased a further 1,000 hectares for eucalypt plantations. Sotico supplied over 30,000 cubic metres of pine log products to customers, including to Wespine. Sotico maintained annual certification of its Boddington site to Australian Standards ISO 9001 and 14001 and, in February 2009, its certification was upgraded to the 9001:2008 Standard. In September 2011, the Boddington land, plantations and forest assets were sold by Wesfarmers the musicians of West australian symphony orchestra at home in the perth Concert Hall. and Sotico no longer operates the softwood logging business. In addition, Sotico owns approximately five hectares of tourist enterprise-zoned land in the Pemberton townsite in Western Australia, following subdivision and sale of individual commercial and residential lots in recent years. During the year, Auswest, which operates a timber mill in Pemberton, was granted an approval under the Noise Regulations of the Environmental Protection Act 1986 to continue to exceed the noise levels allowed under the Regulations which in part affect this land.

Wesfarmers sustainability RepoRt 2011 25 Reconciliation Action Plan

We continue to make sound progress on some of the key priorities identified in our Reconciliation Action Plan, most importantly with the level of engagement across our divisions.

For the second year, divisions conducted For example, where a targeted employment Our employees continue to participate in the a survey of our workforce to determine program is taking place in a particular Wesfarmers Indigenous Network group, a how many self-identified Aboriginal people location, the support and engagement of forum of divisional representatives who are we currently employ. We are focused on local Aboriginal Elders and leaders is sought. championing divisional Aboriginal strategies. increasing Aboriginal representation in This engagement has been important to The group convened four times in 2010/11 the Group with an emphasis on learning the success of specific programs run by the and will continue to meet regularly. to support future success. divisions. Across the Group, our businesses Building respect regularly engage internal and external A number of divisions have implemented main highlights stakeholders to provide strategic advice cultural awareness training, aimed Creating opportunities on Aboriginal programs. at building respect for and greater Most divisions have taken steps to recruit We continue to work with Jawun understanding of Aboriginal peoples, and retain Aboriginal team members. Indigenous Corporate Partnerships, histories and cultures. Practices of Methods differ across the Group, including where skilled employees are seconded to acknowledging Country and inviting targeted Aboriginal employment programs Aboriginal community organisations in the ‘Welcome to Country’ ceremonies are (such as pre-employment training and East Kimberley (Western Australia), Redfern becoming more common, and are mentoring) at Coles, traineeships at Target (New South Wales) and Shepparton supported at the Group level with ‘Welcome and Wesfarmers Resources, cadetships (Victoria). To date, 19 Wesfarmers to Country’ and Acknowledgement of at WesCEF and the Wesfarmers corporate employees have completed secondments, Country guidelines. office, and direct recruitment at Kmart including one long-term secondment. In Wesfarmers corporate office employees and Bunnings. Kmart and Bunnings are 2010/2011, secondment projects included also working with school and community participated in cultural awareness activities the merger of two Aboriginal organisations in March 2011 and many divisions now organisations to offer work experience in Shepparton, and the design of a fly-in, opportunities. display Aboriginal artwork on their fly-out mining employment scheme in premises. Works of indigenous art from the Coles and the Wesfarmers corporate office the East Kimberley. In addition, in 2011 Wesfarmers Collection of Australian Art are have dedicated employees overseeing a non-executive director visited Cape displayed in Wesfarmers’ corporate offices Aboriginal programs. WesCEF and Target York. In 2012, a further 20 Wesfarmers and floortalks are held for employees to are currently recruiting dedicated, part-time employees will complete secondments. meet indigenous artists and curators. These employees to oversee Aboriginal programs. Wesfarmers leadership team members activities support our objective to ensure will continue to visit Jawun communities In November 2010, the Wesfarmers Arts that our businesses are places where to learn more about them and the role National Indigenous Fellowships program Aboriginal culture is respected and where of secondees. at the National Gallery of Australia was Aboriginal people feel welcome and valued, launched. This is the first initiative of its kind as employees, customers and citizens. in Australia, with 12 young and emerging Outcome of workforce surveys indigenous curators awarded scholarships to work intensively with the curators and collections of the National Gallery. division Self-identified aboriginal employees Survey response rate This annual program provides long-term percentage of professional development opportunities number respondents % bunnings 43 1.2 12 and museum industry mentoring. office supplies 36 1 65 Building relationships Resources 24 2.8 90 Our divisions are forging relationships Wis 41 1.8 77 insurance 16 0.8 85 with Aboriginal communities and support WesCeF 9 1.1 55 organisations. These relationships will help Coles 424 0.6 75 to ensure that the work undertaken by each target 295 1.9 64 division is meaningful and has a greater Kmart 123 3 16 chance of success. Corporate office 1 1 47 Wesfarmers Group 1,012 1 56

26 Wesfarmers sustainability RepoRt 2011 We are focused on increasing Aboriginal representation in the Group with an emphasis on left: Coles team members (from left) Vivian Williams, Dean Hegarty, sharon Daylight, Davide sidoti and learning to support future success. Christine ellis. below: Clontarf Foundation student at a Diy day at bunnings, Warrnambool, Victoria.

Tracking progress • Share Aboriginal employment Reconciliation action plan A full report against the actions identified knowledge and experience – 2012 priorities in our 2011 Reconciliation Action Plan can between businesses. • Continuing our commitment to the Jawun indigenous Corporate be found at www.wesfarmers.com.au all divisions participated in the partnerships secondment program 2011 priority areas – how did we go? Wesfarmers indigenous network and supporting the inaugural (Win) Group, which met four times in • Each division will implement its Jawun emerging leaders tour 2010/11. these forums allow divisions Aboriginal strategy, with a focus to share learnings and identify areas • Evaluating Aboriginal employment on employment initiatives. for collaboration. efforts to date, to ascertain all divisions have aboriginal strategies, appropriate models for our industries • Build local relationships between our or diversity strategies, which list businesses and Clontarf academies, • Embedding Aboriginal affairs programs aboriginal employment as a priority to achieve employment outcomes for to ensure their long-term sustainability area. Divisions’ capacity to deliver Clontarf school leavers. on these strategies differs due • Ensuring that Indigenous art continues to resourcing. Wesfarmers continues to make a to be acquired for the Wesfarmers significant annual contribution to the Collection of australian art • Incorporating cultural awareness Clontarf academy. seven divisions material in induction and other have made contact with Clontarf to training processes. explore employment opportunities Cultural awareness training has for Clontarf graduates and some been delivered on an as-needs basis employment outcomes have been throughout the Group. We have learnt achieved. in addition, some divisions that cultural competency is complex, are building relationships with local and that tailored, situation-specific Clontarf academies by hosting store training is more effective than a tours and visiting Clontarf academies. ‘one size fits all’ approach. We will continue to support local relationships between our divisions and Clontarf academies.

Wesfarmers sustainability RepoRt 2011 27 Coles performance overview

about our business Sustainability highlights Safety performance We are one of Australia’s leading retail Rebuilding after Cyclone Yasi and Lost Time Injury Frequency Rate businesses, with brands including Coles Queensland floods and Bi-Lo supermarkets, 1st Choice Liquor During the year, over 25 Coles stores were 2011 16.98 Superstore, Liquorland, Vintage Cellars, affected by the Queensland floods and 2010 12.87 Spirit Hotels and Coles Express. Cyclone Yasi – the worst of these were 2009 15.55 at Emerald, Fairfield and Ipswich. We employ over 102,000 team members 2008 17.45 and operate more than 2,200 outlets. To ensure the ongoing availability of 2007 n/a Approximately 18 million transactions take basic food items for the town of Emerald, place in our stores each week. a temporary store was established at Emerald Police and Citizens Youth Club. At the heart of our business strategy is our goal: ‘To give the people of Australia a In June 2011, we were proud to re-open shop they trust, delivering quality, service our doors at both Emerald and Fairfield, Greenhouse gas emissions Coles – Priorities and outcomes and value’. featuring our latest store format. A new store Tonnes CO2e at Ipswich will be built in the coming year. Year in review 2011 2,523,808 This year was the third year of our No added hormone beef 2010 2,530,856 turnaround plan and we continued to We were the first national food retailer in refurbish our supermarkets with our new Australia to convert our fresh butcher beef 2009 2,978,518 store design and increased the availability to hormone growth promotant (HGP) free 2008 2,938,829 of self-scan checkouts. beef in January 2011, as research shows 2007 n/a that growth promotants can have an effect We also delivered initiatives to build on the eating quality of some cuts of beef. customer trust in our products and prices and in January 2011 launched our ‘Prices Sow-stall free pork are Down’ program. As part of this, we Following our announcement in July lowered the prices of over 6,000 products. 2010 that we would phase out sow-stall Energy use produced fresh pork by 2014, we extended Petajoules Material issues our commitment to include hams and Our sustainability priorities are training bacon made from local and imported pork. 2011 7.27 and development of our team members; 2010 7.39 customer trust in our product range, value We have commenced auditing potential and quality; water saving and energy sow-stall free farms in South Australia 2009 7.29 efficiency of our stores; workplace safety; and Victoria. 2008 7.02 and supporting the local communities in Good Egg Award 2007 n/a which we operate. In December 2010, we were proud to receive a Good Egg Award from the RSPCA for announcing we would no longer sell caged eggs from 2013. Water consumption Megalitres

2011 2,983 2010 2,709 2009 2,170 2008 1,725 2007 n/a

left: RspCa australia’s Heather neil (left) presents Community contribution a Good egg award A$m to the Coles team – Tanya Kleman (centre) and 2011 15.61 6.70 22.31 Jackie Healing. 2010 7.32 1.85 9.17 Right: since 2009 12.36 7.36 19.72 January 2011, Coles fresh butcher Direct, in-kind and product beef has no added Community raised contributions supported hormones. by Coles

28 Wesfarmers sustainability RepoRt 2011 Coles – Priorities and outcomes training and Stakeholder Safety Community Energy conservation development engagement

2010 PRIORITY 2010 PRIORITY 2010 PRIORITY 2010 PRIORITY 2010 PRIORITY Training and Customer trust in Workplace safety Support the local Water saving and energy efficiency development our product range, for our team communities in of our stores of our team value and quality members which we operate members OuTCOME OuTCOME OuTCOME OuTCOME OuTCOME

introduced two new energy data reporting Received a Good ourAchieved ltiFR was Partially achievedinvested Not more achieved than systems to help track energy usage and Delivered 1,178,724 egg award from 16.98 for the year, $22.3 million to energyAchieved efficiency Partially projects achieved Not achieved training hours – up the RspCa for up from 12.87 last community programs Worked with Green building Council of 32 per cent announcing the year, partly due to an and emergency relief australia (GbCa) to finalise a ‘Greenstar’ phase-outAchieved of Partiallycaged achievedincrease Not achievedin manual duringAchieved the year Partially – achieved Not achieved More than 780 rating tool for future freehold supermarket Achieved Partially achievedeggs Notby 2013achieved handling injuries including $5.34 million internal appointments developments in supermarkets in aid of the made from our Retail Received 30 product and bringing Queensland premier’s progressed other energy saving initiatives leaders and Retail quality awards for our calculation Disaster Relief appeal for stores: operations Graduate Coles brand and methodology into line • over 620 stores now have night blinds programs Coles Finest products with other divisions of installed on refrigeration cases to reduce announced the Wesfarmers night-time energy use launch of Coles Delivered training • over 520 stores now have automatic lighting Quality academy to programs to improve controls to reduce energy use outside provide Coles brand safety leadership trading periods suppliers with specific and promote safety quality management • more than 420 stores now have awareness training and provide anti-condensate heater controls installed targeted training for to glass door freezers which reduce the our team members energy use of the heaters in the doors trialled the use of sensor taps to reduce water usage at our store support Centre at tooronga, Victoria

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 29 Coles continued

RSPCA-approved products Our total workforce number is lower as a • Coles Express launched the Passionate We launched an RSPCA-approved range result of our strategy of employing more experts team member development of chicken products in April 2011. The new permanent part-time team members and program, promoting fuel product range is available in Victoria, Tasmania and reducing the percentage of casual team knowledge and customer service. South Australia and is the fourth RSPCA- members employed since 2008. • Coles Liquor team members continued approved product we have launched, In June 2011, we conducted our annual to build on their customer service skills following pork, turkey and barn-laid eggs. Face of Coles survey to provide an and product knowledge through our Sustainable seafood with WWF- insight into the profile and diversity of liquor product training framework. Australia our workforce. Government-funded traineeships In March 2011, we announced a three-year were also offered to our frontline liquor Through these survey results we program with WWF-Australia, a leading leaders with around 200 team members understand there are 424 team members authority on marine sustainability, to deliver completing the program. who identify themselves as being Aboriginal sustainable seafood across Coles-branded or Torres Strait Islander compared with 275 Enterprise Agreements fresh, frozen and canned fish. at the same time last year. During the year, we renegotiated and Our program will ultimately result in more finalised a range of Enterprise Agreements Indigenous employment Marine Stewardship Council (MSC) certified with team members and their union During the year, we announced our seafood stocked at Coles. representatives. Negotiations were Aboriginal and Torres Strait Islander Plan completed for our largest Enterprise Coles Carisma to help us be more representative of the Agreement, which applies to the majority Coles Carisma, a new potato launched in communities we serve and in May 2011 we of team members working in supermarkets. 2010, took out the Marketing Award at the supported National Reconciliation Week, The new Agreement has been approved AUSVEG National Awards of Excellence. holding our first Dreamtime Event at our by Fair Work Australia. Coles Carisma is the only potato in store support centre in Tooronga, Victoria. Safety Australia to carry the official low glycemic The biggest focus for our indigenous During the year, close to 350,000 hours index (GI) symbol from the Glycemic Index employment program was in far north were dedicated to delivering training Foundation. Queensland, New South Wales, Australian programs to enhance safety leadership and Capital Territory and Northern Territory Food donations promote safety awareness across Coles. During the year, we donated over 1.1 million where we are hiring employment kilograms of food to people in need through coordinators to assist new team members Foodbank Australia, SecondBite and with their transition into employment. The Salvation Army. More than 100 team members also completed cross-cultural awareness training to better understand and respect 350,000 Aboriginal culture. Safety training hours delivered Training 1.1m Over the past year, our training programs Kilograms of have focused on lifting our leadership Our LTIFR was 16.98 for the year, up food donated capability and effectiveness across the business. from 12.87 last year, partly due to an increase in manual handling injuries at our Highlights for the year included: supermarkets and also by bringing our We also conducted a pilot program to • More than 780 team members achieved calculation methodology into line with other collect fresh produce from 20 supermarkets internal appointments in stores and store divisions of Wesfarmers. in Victoria, Tasmania, South Australia, support roles following their participation The LTIFR for logistics, Coles Express and Western Australia and Northern Territory in our Retail leaders program and Retail Coles Liquor all improved from last year. in the lead-up to launching a national fresh operations Graduate program. food donation program in the coming year. As part of strengthening our focus on • Over 400 senior leaders participated health and safety during the year, 10 health in the Coles leadership program, people and safety non-negotiable standards were aimed at strengthening leading and As at 30 June 2011, we employed launched for supermarkets and safety focus coaching skills. 102,520 team members, of which 88,579 weeks were held regularly to deliver and worked in our supermarkets, 8,296 in liquor • Approximately 1,100 team members embed safety initiatives. A refresher training stores and hotels and 5,645 in fuel and participated in our High performing program was also delivered to more than convenience outlets. teams program, which focuses on 75,000 team members during May and teamwork skills required to work June 2011. in category management roles in merchandise, marketing, replenishment, logistics and information technology (it).

30 Wesfarmers sustainability RepoRt 2011 During the year we donated over 1.1 million kilograms of food to people in need through Foodbank Australia, SecondBite and The Salvation Army. left: During the year, 20 stores participated in a fresh food donation pilot program, ahead of the launch of a national program in the coming year.

Waste Over the past 12 months, our supply chain and supermarkets have been working hard to reduce stock loss and waste. This year, we recycled 141,022 tonnes of cardboard, paper, plastic, metal and organics, and sent 100,107 tonnes of waste to landfill. More than 58 per cent of our waste was recycled. Organic food waste is currently collected from approximately 239 supermarkets to produce compost. We have recently expanded this collection to Western Australia. In total, we collected 108,060 litres of fat and oil that was recycled into a mixture of animal feed, used as base for lubricants and as a chemical in the manufacture of soaps. Packaging Coles has assessed more than 1,800 Coles branded products against the sustainable packaging guidelines, which are part of the Australian Packaging Covenant (APC). All packaging graded red will be prioritised for review by our product developers. In 2011, we contributed to the Wesfarmers Action Plan for the APC. Coles Express completed store layout Environment Contamination/remediation and equipment assessments at 200 sites Water As reported previously, we continued to test with a view to improving manual handling This year, we were able to map our water and monitor ground water at Coles Express activities, and implemented an injury usage across more than 2,200 sites, Mooroopna, Victoria. management program called ‘First covering supermarkets, liquor stores, Following the results of a report received in 60 Minutes’ to focus on early intervention hotels, Coles Express sites, distribution July 2011, an assessment has been made in work-related injuries. centres and our Store Support Centre that no further testing is required. in Victoria. At our distribution centres, behaviour- environment protection and Coles based safety awareness initiatives were Our total water usage was 2.98 gigalitres, express implemented around the peak workload a 10 per cent increase from last year. The During the year, Coles Express and seasons of Easter and Christmas. Our increase was mainly attributed to the higher Shell worked closely with the Australian distribution centres also continued to refine water usage at our Coles Express sites and Capital Territory and New South Wales their Behavioural Based Safety Observation the inclusion of our distribution centres. departments responsible for regulating the program, which involves managers and The estimated water consumed by our management of underground petroleum team members making daily observations supermarkets was 1.69 gigalitres. Many storage systems (UPSS). to identify at-risk behaviours. of our sites do not have water meters, Legislation in these jurisdictions contains Coles Liquor released a revised safety so our data is extrapolated from actual specific responsibilities for operators of management system for stores and water bills and meter readings across UPSS. In New South Wales, the Office of developed a targeted Aggressive Customer 164 supermarket sites nationally. Environment and Heritage, in conjunction and Armed Robbery training course for all Our Store Support Centre in Tooronga, with local councils, has commenced team members. Victoria, remains our largest single water auditing our sites against UPSS regulations. consuming site. Water usage remained consistent at 33,747 kilolitres.

Wesfarmers sustainability RepoRt 2011 31 Coles continued

Carbon and energy Together with the GBCA we finalised a Salt reduction Greenhouse emissions ‘Greenstar’ rating tool for future freehold Coles participates in the Federal Our total greenhouse gas emissions were supermarket developments. The first Government’s food and health dialogue estimated to be 2,523,808 tonnes of CO2e, development to use the tool as a roundtables, which set the nutrition 0.3 per cent less than last year and equates benchmark is our new store at Greenacre, targets for product categories. to 78.7 tonnes of CO e per million dollars of New South Wales, which is currently 2 This year, for Coles-branded products, revenue, down 7.2 per cent on last year. under construction. we delivered a further eight per cent sodium reduction in breakfast cereals and Governance finalised our plans to meet bread, simmer Ethical sourcing sauces and processed meat targets in the In line with our approach of ensuring required timeframes. 2,523,808 suppliers of Coles brand products comply (tonnes CO e) 2 with our ethical sourcing policy, over the Nutritional labelling Greenhouse past year we audited 85 suppliers out We continued to introduce Daily Intake gas emissions of 316 operating in non-Organisation for (DI) nutritional labelling for Coles-branded Economic Co-operation and Development products during the year, including member countries. seasonal products for 2011. Energy use Of these audits, one critical non- Approximately 1,500 products were Our main uses of energy are electricity for compliance (the employment of an rebranded with DI labelling to help our refrigeration, lighting and cooling our stores, underage worker) by a supplier operating customers make choices that meet their and natural gas and liquefied petroleum gas in China was identified and a corrective dietary requirements. for space and hot water heating. action put in place. Country of origin Our energy consumption this year was We always seek to comply with country 7,266,775 gigajoules, down 1.7 per cent of origin labelling requirements; however, on last year. during the year we were fined for This year, our energy consumption not labelling imported grapefruit for per million dollars of revenue was 1.7% sale at our supermarket at St Marys, New South Wales. This was caused by 227 gigajoules, down 8.0 per cent on Reduction in energy last year. an IT error. We have since invested in IT consumption enhancements and reviewed our internal As part of managing our business labelling procedures to improve country responsibly, we continued to focus on ways of origin labelling compliance in our fresh to use energy more wisely and reduce our The supplier has committed to an improved produce department. greenhouse gas emissions. system to prevent any further reoccurrence Palm oil of this issue and will be audited again within Last year, we reported on three energy In April 2011, we appeared at the three months. efficiency programs for our supermarkets Senate hearing on the Food Standards which are well progressed: In addition to this approach, we ask our Amendment (Truth in Labelling – Palm Oil) • night blinds installed on refrigeration suppliers in lower risk regions to self-assess Bill 2010. their compliance to our ethical sourcing cases which reduce night-time We continue to clearly label palm oil where it policy. During the year, 240 suppliers energy use is used in Coles brand products, rather than completed this self-assessment. • automatic lighting controls to reduce using the term blended vegetable oils, as we energy use outside trading periods Ingredients and labelling believe this makes it easier for our customers Labelling Logic, the final report of the to make an informed purchasing decision. • anti-condensate heater controls installed Federal Government’s Food Labelling We have committed to moving to certified to glass door freezers which reduce the Review panel was released in January 2011. energy use of the heaters in the doors. sustainable palm oil for Coles brand The report makes recommendations products by 2015 and have joined the New initiatives for the year included the for changes to front of pack nutritional Roundtable on Sustainable Palm Oil. first deployment of voltage optimisation labelling, new technologies and country Senate milk inquiry technology to 42 stores. of origin labelling. Following a reduction in the price of Coles Based on trials, we expect this technology The report is currently being considered branded milk in January 2011, a Senate to reduce the incoming voltage to the store by health ministers and their response will inquiry was launched into the potential and reduce total store power consumption. be forwarded to the Council of Australian impact on the Australian dairy industry. Governments meeting in early 2012.

32 Wesfarmers sustainability RepoRt 2011 This year, we raised and contributed more than $22.3 million to community programs and emergency relief. left: Former patient Charlotte, the face of Coles fundraising for the sydney Children’s Hospital Gold Week telethon, pictured with team members at Coles, oatley.

Liquor reform in alice springs During the year, we responded to concerns over alcohol consumption in Alice Springs, Northern Territory by announcing a range of measures which apply from 1 July 2011: • a minimum price for 750 millilitre bottled wine of $7.99 (equivalent to $1.14 per standard drink) • withdrawing all two litre cask wine products • ceasing national liquor promotions in alice springs. Gaming Coles operates 93 hotels with 83 gaming rooms. The majority of these are based in Queensland. All team members are trained in the Responsible Service of Gaming.

Community This year, we raised and contributed more than $22.3 million to community programs and emergency relief. Of this, $5.34 million was in aid of the Queensland Premier’s Disaster Relief Appeal to assist those affected by Cyclone Yasi and the Queensland floods. See page eight for further details of our response. During the year, $7 million of sporting Although Coles does not pay dairy farmers Shopping bags equipment was distributed to more than directly, ahead of lowering the price Further to the ban on lightweight single-use 7,600 schools across Australia as part of of milk we increased the price we pay plastic shopping bags by the South Australian our Sports for Schools program. to processors. Government in 2009, legislation has been We also supported Daffodil Day, raising passed to ban these bags in Northern The interim Senate report was released in more than $1.6 million for the Cancer Territory and Australian Capital Territory. April, acknowledging that customers had Council Helpline and continued to support benefitted from our lower prices and a final The Tasmanian Government has also children’s hospitals in Western Australia, Senate report is due to be released before announced a proposal to ban plastic bags, Queensland and New South Wales through the end of October 2011. which is likely to take effect in 2012. customer fundraising. In July 2011, the Australian Competition Following the success of our green bag In March 2011, we celebrated funding and Consumer Commission announced recycling program in June 2010, where 1,000 school and community garden projects there was no evidence that Coles’ milk customers returned old or unwanted through the Coles Junior Landcare Garden price discounting was in breach of the shopping bags made of polypropylene Grants program since its launch in 2008. Competition and Consumer Act. Further, to Coles, we launched a second bag drive These schools were invited to participate in a that the major impact of the reduction in in September 2010. photo competition and more than 590 entries were received for three age categories, as milk prices since January seemed to have Approximately 78,000 bags were returned well for the Australian Geographic award been a reduction in the supermarkets’ profit and converted into outdoor furniture and and the People’s Choice award. margins on house brand milk. donated to 100 primary schools across Australia. Biofuels Economic investment As at June 2011, there are 292 Coles Tobacco Our total sales for the year were $32 billion Express sites in New South Wales, During the year, there were further bans and our earnings before interest and tax Australian Capital Territory, Queensland on the display of tobacco products in were $1.17 billion – up 21 per cent on and Victoria offering ethanol blended fuel. Western Australia, Northern Territory, last year. Victoria and Tasmania. Trolleys As at 30 June 2011, we have As part of our ongoing commitment to Changes relating to display, ticketing, 741 supermarkets, 785 liquor stores, reduce trolley abandonment, Coles has signage and licensing were required. 93 hotels and 620 Coles Express sites. expanded the use of Carttronics wheel lock Queensland, now the only jurisdiction In the coming year, we will continue to open perimeter systems, which now operate at without a ban on the display of tobacco, new and refurbished supermarkets and over 30 stores. will follow in the coming year. develop new services to meet the needs of our customers. Wesfarmers sustainability RepoRt 2011 33 Home Improvement performance overview and Office Supplies Bunnings

about our business Installation of energy efficient e-tronic Safety performance Bunnings is the leading retailer of home lighting technology continued to be Lost Time Injury Frequency Rate improvement and outdoor living products installed in new stores, with 29 stores in Australia and New Zealand and a major now completed. Micro renewable power 2011 13.41 supplier to project builders, commercial generation projects continue in Western 2010 12.53 trades people and the housing industry. Australia and the Australian Capital 2009 14.56 Territory with results providing a greater Operating from a network of large 2008 13.79 understanding of current technologies and warehouse stores, smaller format stores, 2007 14.48 trade centres and frame and truss their future potential to reduce electricity- manufacturing sites, Bunnings caters for related greenhouse gas emissions. consumer and commercial customers. Development of a comprehensive sustainability database has commenced Sales revenue during the year was which will monitor and report carbon Greenhouse gas emissions1 $6.8 billion. At year-end there were footprint by store. Tonnes CO e Bunnings – Priorities and outcomes 194 warehouses, 59 smaller format stores, 2 Waste recycling rates remain stable at 36 trade centres and seven frame and 2011 221,634 60 per cent and we are now focusing on truss centres operating across Australia 2010 210,620 and New Zealand. At 30 June 2011 we lifting performance in stores with lower 2009 179,046 employed 31,370 team members. diversion rates, identifying remaining recyclables in our waste streams and 2008 186,525 Year in review introducing back-loading of cardboard and 2007 182,802 We continued to work on initiatives across plastic in some regional areas. Rainwater our sustainability agenda aimed at using tanks and capillary mats continued to be less energy, using less water and creating installed in all new stores which helped maintain our water conservation efforts. less waste. Ultimately this will reduce our Energy use long-term carbon footprint, which we To help make sustainability easier and more Petajoules consider a higher priority than purchasing affordable for customers, we launched carbon offsets. The energy efficiency of the online Sustainability Savings Planner, 2011 0.82 our new stores and retro-fitting energy provided a free Sustainability Savings 2010 0.77 efficient lighting in existing stores has Planner booklet and ran free sustainability 2009 0.73 helped us progress towards this goal. themed DIY workshops. Excluding previous year’s purchase of 2008 0.69 Our timber procurement approach in offsets, our total carbon footprint increased 2007 0.64 Australia and New Zealand is industry by 5.0 per cent which is pleasingly slightly leading, with 99 per cent of timber products lower than our network growth. now sourced from low risk plantations or other verified legal or certified sustainable forest operations. Water consumption Megalitres

2011 732 2010 691 2009 717 2008 844 2007 858

Community contribution A$m

2011 3.28 23.09 26.37 2010 2.03 18.06 20.09

left: new online 2009 3.61 11.92 15.53 sustainability 2008 12.50 savings planner. 2007 8.00 Right: Cardboard recycling at Direct, in-kind and product bunnings Community raised contributions supported Dandenong by Bunnings Warehouse, Victoria. 1 Excludes air travel.

34 Wesfarmers sustainability RepoRt 2011 Bunnings – Priorities and outcomes

Environment Environment Stakeholder Community Community Safety engagement

2010 PRIORITY 2010 PRIORITY 2010 PRIORITY 2010 PRIORITY 2010 PRIORITY 2010 PRIORITY Continue work Continue work Continue work Continue providing Maintain our Reduce our All towards carbon reducing scheme with suppliers to customers contributions to Injury Frequency neutral growth water usage and reduce supply with access to improve the social Rate (AIFR) and long-term reducing waste chain resource information about wellbeing of the by 15 per cent footprint reduction to landfill waste and environmentally- communities in through dedicated develop products friendly products which we operate campaigns and with stronger and projects initiatives that OuTCOME OuTCOME sustainability traits that can support target injury hot OuTCOME sustainable living spots and high risk activities OuTCOME We have achieved Despite store OuTCOME a small reduction in network growth, Contributed and OuTCOME theAchieved carbon intensity Partially achievedscheme Achieved Not waterachieved Partially usage achieved Not achieved helped raise more of our operations. remained consistent, Engaged with than $26 million in This has been with Australian suppliers on Continued to direct donations achieved mainly stores using packagingAchieved reduction Partially achieved provide Not customersachieved andAchieved in-kind Partially achievedSlightAchieved Notincrease achieved Partially in achieved Not achieved through new stores 677.3 megalitres and and continued to with access to support. More than injuries has resulted being more energy New Zealand stores provide sustainable information online 100,000 hours of in a 1.36 per cent efficient. Total carbon 54.6 megalitres product choices for andAchieved in-store Partially achievedteam Notmember achieved labour increase in AIFR footprint increased customers through a range went into supporting New stores More than by 5.0 per cent of sustainable local community continued to be More than 99 per 10,000 hours which remains products, catalogues projects fitted with water cent of timber were dedicated to 1.0 per cent lower and DIY projects. tanks and innovative products were training of safety than net store Launched the nursery irrigation purchased from low improvement teams growth online Sustainability techniques risk plantations, or Savings Planner, other verified legal or Maintained waste Sustainability certified sustainable diversion rates with Savings Planner forest operations. stores recycling booklet and DIY Forest Stewardship 60 per cent of workshop waste in Australia Council (FSC) and 36 per cent in certified product New Zealand purchases reached 37 per cent

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 35 Bunnings continued

We also continued to actively support the An increase in forklift incidents was mainly We have also introduced light emitting Australian Government’s commitment due to improved ‘near miss’ reporting and diode (LED) lighting in outdoor areas as a to introduce effective legislation to ban greater awareness of our forklift operators standard in the new store design brief. illegally-sourced timber imports. to report incidents as they arise. Lessons We continue to monitor solar and wind learned from common occurrences are We continued to increase our community micro generation demonstration projects shared across the business to prevent support through more team member-led in the Australian Capital Territory and repeat incidents from occurring. community projects, product contributions Western Australia. and fundraising sausage sizzles to assist Some of the key programs that were Heat reflective paint trials continue to the communities in which our stores launched during the reporting period provide favourable results leading on operate. We also provided emergency included: from the Townsville (Queensland) success assistance to many communities • The ‘choices’ campaign including a film reported last year. We are hopeful that affected by natural disasters including targeting the impact of doing nothing these extended trials will prove effective the Queensland floods and Christchurch when it comes to safety and a roll-out to northern Queensland and earthquakes. Northern Territory sites can be progressed • Training and coaching programs for by the end of 2011. material issues forklift operators and walkie stacker While carbon neutrality remains an users Greenhouse emissions Our total greenhouse gas emissions aspirational target we have refined our • Updating the BSAFE System to simplify (excluding air travel) were 221,634 tonnes short-term goal to focus on carbon neutral health and safety procedures and of CO e, five per cent up on last year. These growth and long-term footprint reduction. processes on-site 2 In the short-term, further large reductions to emissions were largely due to electricity our total carbon footprint may be affected • A team member health assessment consumption at our stores. by the constraints of current technologies program across all sites in Australia and their commercial application. and New Zealand where more than 7,000 team members received a free It is a challenge for our business to health check maintain a consistent downward trend in our injury performance and we continue • New injury management arrangements 8,926 to look for innovative and effective ways for New Zealand sites to improve return to work outcomes for injured Tonnes of cardboard to drive improvements in this area. We and paper recycled were disappointed in safety performance team members. outcomes during the period. Environment people Our commitment to reducing our Our total carbon footprint increased by Building a stronger team and keeping environmental impact includes energy five per cent which is pleasingly lower everyone safe is central to what we set out efficiency measures, water conservation, than net site growth of six per cent. The to do every year. responsible sourcing and packaging waste actual carbon intensity of our operations reduction. It also includes a consistent has remained constant compared to last While the improvements that we achieved focus on sustainable timber procurement to year at 3.3 tonnes of CO2e per $100,000 in our safety performance last year were ensure that timber and wood products come of revenue. not repeated this year, we remain focused from legal and well-managed sources. on developing and supporting site safety This comparison is based on the total gross improvement teams. We implemented a new integrated emissions from last year, excluding the environmental KPI monitoring and reporting offsets that were purchased, as no offsets system known as ‘Treadlite’. The system were purchased in this reporting year. will be fully deployed during the 2012 Water reporting period, delivering enhanced Scheme water usage was 732 megalitres, reporting and analysis on a comprehensive which is an increase of six per cent overall. 10,000 range of indicators. Australian-based store consumption was Safety training Our websites ww w.bunnings.c om.au up eight per cent and New Zealand-based hours and ww w.bunnings. co.nz contain stores down 13 per cent on last year. comprehensive water and energy saving Reducing waste and recycling information to help customers reduce their We continue to work towards our We believe that safety improvements environmental impact through sustainable 85 per cent waste diversion target with can only occur if we engage and involve living and product choices. our Australian stores maintaining a everyone and more than 10,000 hours Energy waste diversion rate of 60 per cent and were dedicated to further train and up-skill Energy efficiency through in-store lighting New Zealand stores 36 per cent. During our safety improvement teams to ensure technology remains a key focus with the year, we disposed of 17,991 tonnes of they are effective in supporting health and 11 new warehouse stores fitted with energy waste to landfill and recycled 8,926 tonnes safety on-site. efficient e-tronic lighting during the year. of cardboard and paper and 493 tonnes of plastics.

36 Wesfarmers sustainability RepoRt 2011 More than 900 school sustainability visits conducted.

left: tree planting activities with bunnings Malaga team members in Western australia.

Our New Zealand operation has also adopted our annual supply chain survey and continues to work collaboratively with the Government, New Zealand Tropical Timber Importers Group and environmental organisations to encourage sustainable timber procurement. stakeholder engagement (public policy) We continue to engage with different levels of government and non-government organisations to work collaboratively on issues and identify further opportunities to work together. In April 2011, we played an active role in promoting the proposed ban on the importation of illegally logged timber by signing the Common Platform and encouraging action from industry, consumers and Federal Government. This followed our support of the Greenpeace- led joint statement in 2009 which called for an Australian Government ban on the importation of illegally logged timber into Australia. We also continue to work with WWF as a member of the Global Forest and Trade Network (GFTN). In June 2011, we became the first retail partner of FSC Australia. FSC will provide education and information for team We introduced back-loading of recyclables ethical sourcing members and customers on the benefits of including polystyrene from Western We continued our factory accreditation FSC certification and we will work together Australian stores and cardboard and plastic program for products we directly import. to assure that our timber products are from from regional sites where commercial Major overseas factories are audited to a responsible sources. recycling is not available. code of conduct based on the International 2011 is the United Nations Year of Forests Labour Organization conventions. Part of A trial is also being conducted in Western and we have partnered with WWF in this process requires factories to be visited Australia to determine the viability of an their Love Your Forests campaign to and inspected by an independent auditor, organic waste recycling stream for green- raise awareness of responsible forest our agents or our buyers. During the year, life organic waste from our nurseries. management. a total of 509 audits were conducted, Store waste diversion reports are provided representing 42 per cent of our total We continued to work with local councils via our intranet to enable benchmarking imported product purchases. and community groups to offer compact comparisons between locations. fluorescent lights and battery recycling We introduced a Timber and Wood programs at selected stores in New South Packaging Products Purchasing Policy in 2003 and Wales, Western Australia and Victoria. Our supplier sustainability roundtable have a zero tolerance to illegal timber. We program engages with a selection of major work closely with our suppliers in order to Sustainability Victoria delivered 473 suppliers about our sustainability drivers establish a condition of supply that requires in-store training programs in 2011 on and gauges their current level of activity independent verification of legal origin as a water and energy rebates available and around carbon reduction, eco-efficiency, minimum for all products made completely sustainable products. We also continued packaging and ethical sourcing matters. from tropical hardwoods. work with local councils on sustainability One of our garden tool suppliers, Cyclone, DIY workshops. Of our timber products, 99 per cent are conducted a packaging rationalisation now sourced from low risk plantations or assessment on key product ranges. A time other verified legal or certified sustainable and motion study is planned once reduced forest operations. In addition, 84 per cent packaging flows through to stores to assess are from certified sustainable sources, the benefits when unpacking products. including 37 per cent that are FSC certified.

Wesfarmers sustainability RepoRt 2011 37 Bunnings continued

education and awareness Community We are committed to an ongoing, active During 2011, New Zealand supported Actively participating in the local communities and engaging role within each of our local Earth Hour through sustainability themed in which we operate is integral to all communities and through this support we workshops and a sustainability walk with of Bunnings’ community involvement were able to contribute and help raise more local schools. In June 2011, we actively activities. We contribute to a diverse range than $26 million. Our teams supported well supported World Environment Day through of local, regional and national programs over 42,000 community activities through DIY workshops, merchandising sustainable in Australia and New Zealand and we fundraising sausage sizzles, hands-on DIY product displays with local suppliers and continue to embrace the ’we live here too’ projects and renovations, local fundraising councils. Australian stores for the fourth philosophy throughout our team. activities, community workshops and more. consecutive year held water saving DIY During 2011, New Zealand launched phase Our support included hands-on team workshops for National Water Week. one of their schools sustainability program. member involvement, product contributions Western Australian stores and the Water This program follows the Australian and financial assistance. Corporation launched their first showerhead model which saw more than 900 school We were able to provide emergency exchange program, exchanging more than sustainability visits conducted last year. assistance to many communities 57,000 showerheads. This program was Australian stores also supported Schools affected by natural disasters including based on the Victorian model that this Tree Day, founded by Planet Ark, for the the Queensland floods and Christchurch year saw more than 13,000 showerheads third consecutive year through a native tube earthquakes, including raising more than exchanged at metropolitan stores. stock planting activity with local students. $730,000 for the Queensland Premier’s We also continue to support Green Up Disaster Relief Appeal. Clean Up through local planting and clean-up activities and Firestarter Youth Environment Conferences by providing 70,000 materials and hands-on native bird box building workshops. 42,000 More than 70,000 Australian stores supported a number showerheads exchanged of organisations through locally driven, Community store run activities. These included the activities supported Prostate Cancer Foundation of Australia, We launched the interactive Sustainability White Ribbon Day, St Vincent de Paul Savings Planner on our Australian website, and The Salvation Army in several states Bunnings also committed a further to help make sustainability easier and more and territories, local emergency services, $1 million to directly support impacted affordable for customers. The online tool Returned and Services League, Legacy, local communities in Queensland with their allows customers to undertake an individual Lions and Rotary groups, young mother recovery and rebuilding efforts and has assessment of their home and garden and groups and the Red Shield Appeal. been actively supported by on the ground produces an action plan which suggests assistance from Bunnings team members. products to implement and associated Our New Zealand stores supported the Over $130,000 was raised for the savings. It is supported by the Sustainability Red Cross, Cancer Society and Mental Christchurch Earthquake Appeal through Savings Planner booklet and DIY workshop. Health Foundation (Movember), St John Ambulance, Lions and Returned Services community family events held in Australian In 2011, we conducted a sustainable timber Association, Heart Foundation, Child and New Zealand stores, along with purchasing seminar in partnership with FSC Cancer Foundation, @Heart and active barbeques held across New Zealand. Australia and WWF, which was attended by support of Keep New Zealand Beautiful Bunnings also contributed a further senior marketing and merchandising team Clean Up Week. $100,000 to the Appeal consisting members. We also worked with TAFE NSW of a $50,000 donation to the Red to deliver a ‘Sustainability Solutions’ online Cross and $50,000 to support local training program which is now available to community projects in areas affected all team members and is included on the by the earthquakes. sustainability training intranet pages. For further details on our sustainability Voluntary team member Green Action performance, please go to our sustainability Groups continue to look for opportunities pages at ww w.bunnings.com.au and to reduce energy and water usage and www.bunnings. co.nz drive waste reduction.

38 Wesfarmers sustainability RepoRt 2011 More than 99 per cent of timber products purchased are sourced from low risk plantations or other verified legal or certified sustainable left: timbertrade sales area at the bunnings forest operations. Cockburn Warehouse, Western australia.

Bunnings – 2012 priorities • Continue to work towards carbon neutral growth and long-term footprint reduction • Increase waste diversion rates and continue to reduce scheme water usage • Increase work with suppliers to reduce product packaging and supply chain resource waste • Drive more sustainable product development and continue providing customers with access to information about environmentally friendly products and projects that can support sustainable living • Maintain our contributions to improve the social wellbeing of the communities in which we operate

timber supply chain approach We continue to make improvements Bunnings has had a zero tolerance in this area and work collaboratively approach to illegal timber in its supply chain with Greenpeace and WWF. since 2001. Since then, our sustainable We are proud to report that more timber purchasing policy has provided a than 99 per cent of timber products framework to transition towards achieving purchased are sourced from low risk third party certified timber products. plantations or other verified legal or Key achievements over the past decade certified sustainable forest operations. include: While we make no claim to be perfect, • being the first retail partner of the WWF we genuinely believe that this is the Global Forest Trade Network in 2004 right thing to do and we know that customers and our team members • launching our exclusive FSC certified expect this from us. outdoor furniture range in 2007 • being the lead retail signatory to the 2009 Greenpeace-led joint statement calling for a Federal Government ban on illegal timber imports into Australia • supporting the Common Platform statement which reinforced the call for effective legislation in 2011 • partnering with WWF in the Love Your Forests Campaign in 2011, and • becoming the first FSC Australia retail partner in June 2011.

Wesfarmers sustainability RepoRt 2011 39 Home Improvement Performance overview and Office Supplies Office Supplies

About our business Officeworks’ partnership with Mobile Safety performance Officeworks is Australia’s largest retailer and Muster, the official recycling program of Lost Time Injury Frequency Rate supplier of office products and solutions the Australian mobile telecommunications for home, business and education. Harris industry, resulted in the collection of more 2011 12.17 Technology caters predominantly for small- than 1,400 kilograms of mobile phones 2010 11.95 to-medium businesses and early adopters and accessories for recycling. 2009 12.30 of technology, and is reported here as part We continued our participation in the 2008 10.40 of the Office Supplies portfolio. Cartridges for Planet Ark program 2007 n/a Employing more than 5,000 team with more than 135,800 kilograms or members, we cater for a broad range 596,400 units of used ink and toner of customers that include small-to-large cartridges diverted from landfill. We size businesses, students and teachers, achieved a significant milestone of more health care services, private, public and than two million units collected cumulatively Greenhouse gas emissions government organisations, as well as since we first participated in this program Tonnes CO e personal shoppers. in 2005. 2 We provide our customers with Many local community organisations 2011 65,000 three ways to shop: a national were supported during the year, with gift 2010 63,362 network of 140 retail stores; online at cards, products and team member time 2009 55,522 ww w.officeworks. com.au; or by contributed to primary schools, sporting 2008 n/r telephone/fax at our call centres in clubs, aged care facilities, kindergartens, 2007 n/a Melbourne, Victoria and Sydney, hospitals, Rotary clubs and Lions clubs. New South Wales. Nationally, we supported Australia’s Biggest Morning Tea for the Cancer Year in review Council and sold fundraising merchandise During the year, 10 new Officeworks for Remembrance Day and ANZAC Day. stores opened, including two relocations, Funds raised from those sales went to Energy use and six stores were fully upgraded. At the Returned and Services League (RSL) Petajoules 30 June 2011, there were 135 Officeworks and the ANZAC Day Commemorative 2011 0.21 stores and five Harris Technology business Committee (ANZAC DCC). centres operating across Australia. 2010 0.21 Our business’ contribution to our local 2009 0.17 We remain determined to look after our communities during 2010/11 was more team, with a focus during 2010/11 on than $1.35 million. 2008 0.06 taking personal responsibility for safety 2007 n/a and wellbeing. We have had a pleasing improvement in our safety performance from an AIFR of 47.20 in 2009/10 to 36.22 this year. Water consumption Megalitres

2011 50 2010 52 2009 n/r 2008 n/r 2007 n/a

Community contribution A$m

left: officeworks 2011 0.97 0.38 1.35 Highett team 0.51 0 0.51 members, Victoria. 2010 2009 0.49 n/r 0.49 Right: blue september 2011 Direct, in-kind and product at officeworks Community raised contributions supported Ringwood, Victoria. by Of ce Supplies

40 Wesfarmers sustainability RepoRt 2011 Office Supplies – Priorities and outcomes

Ethical Stakeholder Environment Community Environment Recycle sourcing engagement

2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority implement an Provide Further improve increase our continue work to continue to work ethical sourcing customers with our waste and contribution to reduce the use with government policy in relation information about emissions data improve the social of unnecessary and industry to to our paper and office products systems wellbeing of the packaging in our finalise a national timber products with lower communities in products model for e-waste environmental which we operate recycling outcome impact outcome outcome outcome outcome outcome Systems to collect Launched a water consumption Participated in Supplier Code dataAchieved were improved Partially achieved Achieved Not achieved a the Australian Participated of AchievedConduct andPartially achievedCommunicated Not achieved during the year; significant increase Packaging in the national a Responsible to customers in however, due in our community Covenant (APC) televisionAchieved and Partially achieved Not achieved Forest Products bothAchieved retail and Partially achievedto the Not nature achieved of contribution to andAchieved started workPartially achievedcomputer Not achieved product Procurement Policy. business channels our operations, $1.35Achieved million Partially achievedon an Not action achieved plan to stewardship Implementation is highlighting a range in particular achieve the targets scheme underway of environmentally- the location of and benchmarks implementation preferable product the majority of working group choices. The our stores in product selection centres owned criteria project and operated by published in 2010 external parties, has proved more we are still unable complex than we to report in detail originally anticipated on our water and as a result consumption may take longer to finalise than originally foreseen

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 41 Office Supplies continued

Material issues ‘OTV’ was launched on our intranet during taking our total contribution to AWC Material Issues for our stakeholders the year, providing a library of training since 2008 to almost $90,000. include our continued contribution to the videos for team members to easily access Our greenhouse emissions during the wellbeing of the communities in which we at store level and designed to provide short, year were 65,000 tonnes with the major operate; the continued development of simple help and advice to frontline team contribution to this being electricity use our waste and emissions data capturing members on the range of products and in our stores. Our total energy use was systems; looking after our team and services available in our business. 211,539 gigajoules. making Officeworks a great place to work; More than 94,600 hours of facilitated and continued reduction of our waste to landfill online training were delivered during the Community and increased rates of recycling; and year with programs including induction, For the first time in 2010 we supported further improvement of the sustainability safety, product knowledge, customer Blue September, an event designed to of our sourced products. service and leadership capability raise awareness about men’s cancer and Officeworks is committed to and has development. funds for the Australian Cancer Research robust policies in relation to the responsible Foundation and Bowel Cancer Australia. sourcing of forest products to ensure pulp Our team members and customers across and paper products are procured from legal Australia supported the cause, and we and well managed sources. Officeworks ultimately contributed almost $100,000 to maintains an ongoing dialogue with credible the campaign, including in-kind assistance independent groups in reviewing those 94,600 hrs and more than $84,000 in funds. policies and outcomes. Recently trading Training hours In January 2011, we added to our range of was suspended with a supplier pending delivered reusable bag alternatives with the Helping unresolved sustainability concerns. Kids Grow bag which is manufactured from jute. We donate one dollar from every People unit sold to the Australian Literacy and During the year, our Health and Safety Environment Numeracy Foundation (ALNF) to assist with Team reviewed the Stay Safe reporting The collection of e-waste continued at indigenous and marginalised children’s system to ensure it better reflects our safety our Ballarat and Dandenong stores in literacy programs. Since January 2011, culture. The team also risk-profiled our Victoria, with 39,790 kilograms of e-waste more than $35,000 has been donated business, resulting in the development of diverted from landfill and recycled with the to the ALNF from the sale of these bags. risk registers and updating all of our safe assistance of our reverse logistics service work practices. provider TIC Group. Once again, we supported the Whitlam Institute’s ‘What Matters?’ creative writing Safety leadership training was also competition for students in years 5 to 12 launched during the year, aligning our safety in New South Wales and the Australian culture with our leadership model, providing Capital Territory. The 2011 event received our leaders with the tools required to drive more than 1,800 entries, with children from safety in their teams. 39,790 kg 176 schools submitting works explaining More than 99 per cent of team members E-waste diverted what matters to them. are shareholders through the Wesfarmers from landfill Our team members and customers Employee Share Ownership Plan. contributed more than $61,000 to the We continued to partner with numerous ANZAC DCC in Queensland and the RSL suppliers and service providers to give The roll-out of rainwater harvesting tanks nationally through the sale of fundraising team members access to discounted at our stores continued. Our total water use merchandise in the lead-up to ANZAC products and services. Our second annual during the year was 50 megalitres. Water Day and Remembrance Day in the Climate Survey was conducted, this consumption is estimated again in 2010/11 reporting period. time including a focus on team member using the consumption data available at In addition, $574,831 was contributed demographics. This survey allows us to one of our free-standing sites. to local communities through donation measure how our team feel about working As a result of a successful trial during and sponsorship activities conducted for the business and to identify potential 2009/10, power-factor correction devices, by our stores. opportunities for improvement. Importantly, which allow us to make better use of the the survey now provides us with information available electricity, are now standard in Economic contribution about the diversity of ages, culture and life our new store design specifications. Operating revenue for our businesses was experiences of our team members. We stopped providing single-use plastic $1.47 billion for the full year. Earnings before At 30 June 2011 our workforce was equally bags in December 2008 and have reusable interest and tax were $80 million. represented by males and females, with alternatives for sale. Proceeds from the the Climate Survey data showing 30 team sale of these bags go to the Australian members participating in the survey self- Wildlife Conservancy (AWC) to assist it to identifying as Aboriginal and/or Torres establish sanctuaries for the conservation Strait Islander. of threatened wildlife and ecosystems. During the year, $14,378 was donated,

42 Wesfarmers sustainability RepoRt 2011 We were pleased to contribute resources for 600 literacy packs which will be distributed to students and communities on Palm Island and Groote Eylandt. Main: Children from the palm island community with their alnF literacy packs.

Office Supplies – 2012 priorities • Continue work on our ethical sourcing program, in particular the transparency of our forest products supply chain • Provide customers with information about products and services which lower their environmental impact and help them to make environmentally preferable purchasing decisions • Further improve our waste and emissions data collection systems • Maintain our contribution to improve the social wellbeing of the communities in which we operate • Continue work to reduce the use of unnecessary packaging in our products

Officeworks supports children’s This presents a significant barrier to literacy and numeracy developing the necessary literacy skills Our primary focus area for our community required for them to actively participate involvement activities is children’s in a schooling environment. education. We recognise not only every The Literacy Pack program supports child’s right to receive an education, but ALNF’s existing projects and initiatives also the critical importance to Australia’s by providing young people with the future that they receive it. required resources to foster successful Since 2009, we have worked with home and school learning environments. the Australian Literacy and Numeracy In 2011, we were pleased to contribute Foundation (ALNF) on a number of projects resources for 600 literacy packs including Share-A-Book and Helping Kids which will be distributed to students Grow. In 2011, as we did in 2009, we and communities on Palm Island and donated materials in support of ALNF’s Groote Eylandt for the remainder of Literacy Pack program. the calendar year. The foundation is dedicated to raising This, combined with the $42,000 language, literacy and numeracy standards contributed to the foundation through in Australia and raises funds to develop, the collection of Share a Book implement and sustain innovative projects donations, the sale of Helping Kids Grow for individuals, families and communities. bags and collection of back to school The ALNF teaches marginalised Australians donations, further cements a partnership how to read and write with an approach which will help give disadvantaged that is both tailored to the specific needs kids access to school supplies and of individual groups and communities and materials which will inspire their passion uniquely effective in delivering observable for learning as well as supporting it. outcomes. One of the many challenges By raising literacy levels among these faced by ALNF when implementing literacy kids, Officeworks and ALNF hope to programs in marginalised communities is empower thousands of marginalised the lack of basic literacy resources available children to reach their full potential. to students.

Wesfarmers sustainability RepoRt 2011 43 Target Performance overview

About our business A key highlight for the year was achieved in Safety performance Offering a unique combination of product, October 2010 when we reached $1 million Lost Time Injury Frequency Rate value and convenience, Target is a leading dollars raised for The Alannah and Madeline retail destination for fashionable clothing Foundation’s Buddy Bags Program since 2011 6.96 and homewares. commencing support in 2008. 2010 7.97 Our core product ranges include In the area of environmental performance, 2009 9.20 ladieswear, intimate apparel, menswear, we continued to successfully reduce 2008 9.34 childrenswear and nursery, accessories and excess packaging from key merchandise 2007 10.36 footwear, homewares, electrical, toys and areas in line with our commitment to the other general merchandise. The majority Australian Packaging Covenant (APC). of clothing is Target-branded, with national brands and licences used to complement Material issues the Target range. • Improve communications, database Greenhouse gas emissions management and reporting to better At year end, more than 24,000 team Tonnes CO2e members were employed in 172 Target engage supply partners to comply with stores and 119 Target Country stores our ethical sourcing Code 20111 244,995 throughout metropolitan and regional • Support the safety of team members 2010 239,827 Australia. by reducing manual handling risks 2009 219,858 within our stores and sites 2008 230,545 Year in review • Build strong relationships and improve 2007 n/a Sustainability continued to be a strong communications with our stakeholders focus for us. We advanced our team member training and safety; continued • Continue to make a positive difference to review our environmental impact; and within the australian community by worked closely with our key community partnering with organisations that partners. support safe, happy families Energy use Petajoules We introduced a new safety training • Minimise waste generated by our package for management team members. activities and through the life cycle 2011 0.82 We also continued to implement new of our products 2010 0.84 equipment and modifications to reduce • Improve data management and 2009 0.82 exposure to manual handling risks. This reporting that will further reduce 2008 0.76 contributed to a reduction in workplace energy use across our business incidents and a decrease in our LTIFR 2007 n/a from 7.97 to 6.96. In 2010, we had a high response rate of 87.4 per cent to our ongoing team member survey. Water consumption Megalitres

2011 311 2010 339 2009 n/r 2008 n/r 2007 n/a

left: thomas Collyer (left) and tom bowen using Community contribution the new carton conveyor system A$m at the erskine park storage facility in 2011 1.10 2.02 3.12 new south Wales. 2010 1.44 1.64 3.08 Right: in May 2009 0.99 1.68 2.67 2011, the team at Laverton Direct, in-kind and product storage facility in Community raised contributions supported Victoria showed by Target their support for

Red nose Day. 1 Includes Coles Group Asia (714 tonnes C02e).

44 Wesfarmers sustainability RepoRt 2011 Target – Priorities and outcomes

Safety Stakeholder Community Environment Environment engagement

2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority continue to focus Strengthen continue to grow Build on our expand our on improving communications our community current processes data collection safety in manual with suppliers programs with a to further improve and systems to handling within to improve focus on children recycling and support further our business compliance with reduce waste improvement in target’s ethical our environmental outcome Sourcing code performance outcome outcome

outcome outcome We achieved a Updated online key milestone, Increased the safety training raising $1 million quantity of materials courses for our store Completed a for The Alannah collected for Continued to work team members and full review of our andAchieved Madeline Partially achievedrecycling Not achieved at our with our teams in introducedAchieved purpose- Partially achievedEthicalAchieved Not Sourcing achieved Partially achievedFoundation’s Not achieved Buddy storesAchieved and sites Partially achievedstores Not and achieved facilities, built manual Code and business Bags Program supported by our handling equipment procedures. Our since commencing serviceAchieved providers Partially to achieved Not achieved at selected sites commitment to support in 2008 refine and develop social compliance We also raised more our data systems continues to be than $250,000 for and reporting communicated SIDS and Kids, a to our supply base 24 per cent increase on last year’s result

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 45 Target continued

People We continued to roll-out initiatives from Carbon and energy We continued our commitment to the our diversity strategy and provided Greenhouse emissions safety and wellbeing of our team members, opportunities for eight Aboriginal people Our total greenhouse gas emissions were reducing our lost time injury frequency to undertake school-based traineeships estimated to be 244,995 tonnes of CO2e, rate from 7.97 in the previous year to in Western Australia and South Australia. up 2.1 per cent on last year, and this 6.96. A key initiative to improve the safety Following the 2010 cultural awareness equates to 64.3 tonnes of carbon dioxide standards and increase productivity was a training conducted with store managers per million dollars of revenue, up 2.5 per new carton conveyor system. After working and the senior leadership team, we cent on last year. Our greenhouse gas with a materials handling equipment provided training to our stores in Fulham emissions were largely due to electricity supplier, we redesigned an existing height- Gardens and Elizabeth in South Australia consumption at our stores, distribution adjustable conveyor system to unload loose and Kalgoorlie in Western Australia. centres and support centres (approximately loads in shipping containers and trailers. During the reporting year, two team 88.4 per cent), synthetic gases used in our The equipment has variable height and members participated in the Jawun air-conditioning (approximately 3.6 per cent) speed settings which eliminate the need to Indigenous Corporate Partnership Program and waste disposed off-site (approximately manually push cartons down the conveyor in October 2010 and March 2011, each 3.5 per cent). and reduce awkward body postures such completing secondments to the East energy use as reaching, pushing and twisting. Kimberley region. Our main energy use during the year was We celebrated and recognised the electricity consumption for lighting in our achievements of our team members at the stores. Total energy consumption was annual Target Rondel Awards in August 820,520 gigajoules, down 2.4 per cent on 2010. The 16 award categories included last year. Our total energy consumption per 41% safety, customer service, leadership, million dollars of revenue was estimated to Management roles community and sustainability. be 216 gigajoules, down 1.9 per cent on last year. This energy use was mainly 87 per cent held by women Environment electricity and seven per cent fuel. In line with our commitment to the APC energy efficiency initiatives Safety is important across our business. we continued to reduce excess packaging We continue to evaluate and implement During the year, we introduced a new and develop sustainable packaging the recommendations from our EEO instructor-led safety course for all guidelines for key merchandise areas such representative assessments for improving management team members participating as footwear. For example, by suppliers energy efficiency where these are cost in the Target Store Leadership program. excluding cardboard inserts from slippers effective to the business. Following an This hands-on program complements we removed 15.8 tonnes of excess energy efficiency trial conducted in May our wide range of online health and safety packaging. In total, across footwear we 2011 at selected sites, we identified training courses. saved more than 63 tonnes of packaging an opportunity to reduce our energy during the reporting period. consumption by changing the temperature In August and September 2010, we held settings within stores. ceremonies to celebrate the 285 graduates from our inaugural Future Leaders In June 2011, we started a program to program, the first stage of our development adjust the temperature settings by between framework for store management team one and two degrees. members. Graduates progress to the Target 63 tonnes At our purpose-built storage facilities Store Leadership program in which 521 Decreased footwear servicing multiple stores we have introduced team members were enrolled in June 2011. packaging light sensors that switch off unnecessary Following a pilot in 2010, we selected lighting and reduce energy consumption. 30 high-potential female managers In these sites we have installed large ceiling from across our business to participate Team members participated in the third mounted fans which enable significant in the inaugural My Mentor Women’s annual Target Green Week Challenge held volumes to be circulated efficiently. We also Development program. We also held our in June 2011. The theme ‘Rethink, redesign retro-fitted existing compactors with new first networking event ‘Targeting Women in and remove’ was about looking at how we feeders at six sites to accommodate plastic Leadership’ to promote the representation can do things differently throughout the recycling balers. of women in senior management and business to further reduce our impact on non-traditional roles. As at 30 June 2011, the environment. We conducted a survey Governance women represented 76 per cent of all our in all stores to more accurately measure ethical sourcing employees and 41 per cent of management water use. This was estimated to be a total We consistently strive to source products roles were held by women. of 311 megalitres per year which equates through our socially responsible Ethical to 82 litres per full-time employee per day. Sourcing Code. We reserve the right not to do business with vendors that do not share and demonstrate this commitment and we regularly audit our suppliers’ factories to assess their performance. During the reporting period, we completed a full review of our code and business procedures. 46 Wesfarmers sustainability RepoRt 2011 We continued to reduce excess packaging and develop sustainable packaging guidelines for key merchandise areas such as footwear.

During the year, we continued our commitment to local communities across the nation by providing 90 free St John Ambulance first aid courses for parents and carers of children aged 12 and under. Each course is valued at $125. This equates to 1,180 people having the knowledge and skills required to provide basic first aid and emergency care for children. In November, our annual Christmas gift giving campaign with UnitingCare was relaunched as Operation Santa. Customers and team members donated more than 63,500 gifts and $172,000 worth of gift cards to the appeal which is now in its nineteenth year. We also supported the SIDS and Kids Red Nose Day, with customers and team members purchasing $250,000 worth of Red Nose Day merchandise from our stores in June 2011, a 24 per cent increase on last year’s result. Through our community donations program, $106,525 worth of gift cards were provided to not-for-profit organisations in our communities to assist with local fundraising efforts.

Stakeholder engagement Reducing unnecessary packaging These savings included more than We are committed to ongoing engagement We are committed to reducing excess 19 tonnes of packaging from children’s with our stakeholders which include packaging from our business. shoes, 34.8 tonnes from women’s customers, shareholders, team members, In the footwear department, we saved more shoes and 7.9 tonnes from men’s shoes. suppliers of goods and services, and than 63 tonnes of packaging over the past We will continue to develop and revise community partners. sustainable packaging standards in key year by reducing the use of cardboard, Our complaints handling process provides merchandise areas, and as we review foam inserts, separators and tissue paper. a responsive service for our stores and other departments we aim to achieve customers in accordance with the AS further savings. ISO 10002-2006 for Complaints Handling and our customer relations team received 60,993 contacts in 2010/11. In 2010/11, we conducted 430 factory Community audits; this included 175 audits We aim to make a positive difference We recently became active in social media, conducted by third party auditors and we through our nationwide partnerships and by providing a new forum for customers to acknowledged 248 factories through our supporting the local communities in which provide feedback. mutual recognition program. Three zero- we operate. Our total contribution this year Each month we monitor customer tolerance issues were detected and one was valued at $3.12 million and includes perceptions, attitudes and behaviours factory was deregistered as a supplier due $2.02 million contributed by our team towards the Target brand and use this to poor social compliance. members, customers and suppliers. research to shape future strategies and compliance A highlight was the launch of our ongoing actions. In 2010, this research led to the We updated our online training module community campaign ‘We Love Kids’ which introduction of our customer service for Target’s Fair Trading Policy to provide includes a television commercial which program Operation Target to improve a practical learning tool for team members this year supported the recent SIDS and interaction with our customers. to promote a greater understanding of Kids campaign. During the year, we conducted a survey the new Australian Consumer Law (ACL) Our key partnerships continued to to assess the engagement of our team introduced on 1 January 2011. reflect our commitment to ‘safe, happy members, with 20,869 participating in In an external audit for Payment Card families’. In October 2010, we thanked the survey. Industry Compliance we were assessed our customers for helping us reach the to be compliant with all applicable $1 million donation milestone for The requirements. Alannah and Madeline Foundation from the sale of our red re-usable bags.

Wesfarmers sustainability RepoRt 2011 47 Kmart Performance overview

About our business We have identified new energy saving Safety performance Kmart is one of the largest general initiatives which will reduce the amount of Lost Time Injury Frequency Rate merchandise and apparel retailers in energy our sites use by 20 to 40 per cent. 6.78 Australia and New Zealand, with 187 stores, Our community program focused on 2011 five distribution centres and sourcing teams our annual Wishing Tree Appeal which 2010 9.02* located in Hong Kong, China, Bangladesh has once again seen significant support, 2009 11.18 and India. Our 24,000 team members, collecting almost 500,000 gifts. Our Art of 2008 10.74 excluding Kmart Tyre and Auto (KTAS), Giving competition received 7,800 entries 2007 11.02 are focused on delivering exceptional and we raised over $475,000 through our customer service to families and supplying coin collection program (excluding the great products at low prices right across Kmart Wishing Tree Appeal). the store, every day. For the year, our operating revenue was KTAS is one of the largest automotive $4.04 billion and EBIT was $201 million1. Greenhouse gas emissions service, repair and tyre businesses in Whilst customer transactions and volumes Tonnes CO2e Australia. KTAS has 251 stores and continued to grow, this was offset by more than 1,400 team members. reduced prices. Our focus for the coming 2011 311,668 year is to ensure we have the right product 2010 303,397 Year in review across the store, executed as efficiently as 2009 257,087 The entire Kmart business is now operating possible from the supplier to the shop floor. an ‘everyday low price’ model, where 2008 310,391 traditional sales have ceased in favour of Material issues 2007 n/a offering our customers quality products at Our business will continue to focus on five the lowest prices, every day. Our ‘expect key areas to improve our sustainability: change’ campaign, which ran from January 2010 and invited customers back into our • Continue to restore the foundations stores, was well received and our focus for of our business Energy use the coming year is to educate customers • Ensure our sites are safe for team Petajoules about the ‘new’ Kmart. members and customers • Reduce the amount of energy we use 2011 1.08 We have continued to reduce the number of injuries in our sites; however, our targeted • Ensure our packaging meets the 2010 1.04 aim of reducing the number of lost time requirements of the business and 2009 0.99 injuries by 50 per cent was not met, with our the Australian Packaging Covenant 2008 1.05 • Continue to focus on our community business recording a 29 per cent reduction. 2007 n/a program. A review of product packaging has commenced with key highlights mentioned in this report.

1 Excludes $3 million earnings related to Coles Water consumption Group Asia overseas sourcing operations. Megalitres

2011 767 2010 775 2009 n/r

left: the new 2008 n/r distribution centre 2007 n/a in Victoria, features a range of initiatives to reduce the environmental impact of the site. Community contribution Right: We have A$m reduced the amount of packaging used 2011 0.74 10.57 11.31 across a number of products, including 2010 2.35 4.53 6.88 the stuffing from our footwear 2009 1.02 10.83 11.85 range, which will remove more Direct, in-kind and product Community raised contributions supported than 174 tonnes by Kmart of packaging material annually. * Data adjusted due to reclassification of claims.

48 Wesfarmers sustainability RepoRt 2011 Kmart – Priorities and outcomes

Energy Environment Stakeholder Safety Community conservation engagement

2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority Focus on energy commence Grow and develop reduce the expand our use and introduce reviewing our the capabilities of number of lost media program to initiatives to packaging to our line managers time injuries by continue to foster reduce the ensure it is cost and national office 50 per cent support for the amount of energy effective and meets team members communities in we consume the requirements which we operate outcome of the Australian outcome Packaging outcome outcome covenant, whilst being easy to use for our customers Reduced our and team members ‘Managing people lost time injuries Identified a range of at Kmart’ course byAchieved 29 per cent Partially achievedStrengthened Not achieved our additional initiatives introducedAchieved for Partially all achieved Not achieved media presence to Achievedreduce energy Partially achievedoutcome Not achieved general managers to highlight what use and will soon and direct reports our stores are trial these in a doingAchieved regarding Partially achieved Not achieved number of stores coin collection and to assess their Improvements local investment. suitability were made to our We have also packaging to reduce developed a social the amount we media presence, use.Achieved Some of Partially these achieved Not achieved highlighting our work improvements will save more than 3,000 tonnes of packaging each year

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 49 Kmart continued

People Carbon and energy Product and packaging We are committed to ensuring our sites are This year, we identified a range of initiatives improvements safe, our 25,462 team members receive to significantly reduce the amount of energy Our merchandise team focused on training to reach their full potential and we consumed in our existing stores. These improving the environmental performance have a diverse workforce that is recognised initiatives include: using the sun to provide on a range of products and reducing the and rewarded for the work they do. light in stores; installing more energy efficient amount of packaging used. A number of lighting; monitoring and controlling where examples will be included in Wesfarmers’ Safety improvements introduced this and when we use energy; using natural Australian Packaging Covenant report for year include providing improved materials ventilation to provide fresh air; and making 2010/11. Some key highlights include: handling equipment as well as providing our air conditioning systems more efficient. new storage racks in selected stores. • reducing the number of pages in our These initiatives will soon be trialled. Additionally, we have introduced new weekly marketing catalogues, saving initiatives, including boom gates and safety As a result of a review of the specifications over 3,012 tonnes of paper for new distribution centres, as mentioned rails, to reduce the potential for falls from • removing the stuffing from footwear, in last year’s report, our new sites in our loading docks. During the year, a resulting in a reduction of 174 tonnes Victoria and New South Wales use a range new health and wellbeing program called of packaging material ‘Kmeasures’ was launched to assist team of improved energy efficiency measures: members improve their health and reduce rain water harvesting; more efficient tap • moving our reusable shopping bags to the risk of conditions including heart ware; solar hot water; better use of natural 100 per cent recycled material – more disease and type two diabetes. sunlight; motion sensors to turn off lights than 33 tonnes of recycled plastic will in office areas; window glazing; improved be used to make these bags now, insulation; and using recycled concrete. rather than using virgin plastic • changing the way Kmart’s Homemaker- branded kettle is packed to reduce 13,900 packaging by 25 per cent Team members % • using recycled phone books to make received training 77 our paper pet litter Store waste recycled • moving from blister packs for power leads, power boards and audiovisual We recorded 167 lost time injuries for the accessories to cardboard packaging year, down 29 per cent on last year (our or shelf-ready packaging target for the year was to reduce this by To reduce the amount of energy used • removing backing cards from kitchen 50 per cent). We are now working on a when charging our electric forklifts, we utensils and bath mats, replacing this range of initiatives, including new training have introduced a policy to only recharge with a small sticker. programs focusing on line manager and these devices when they fall below safety committee capability to assist in 25 per cent charge at these sites. In Community further reducing team member injuries. addition, the New South Wales site will The Kmart Wishing Tree Appeal is Australia’s The coming year will also see us introduce use more energy efficient lighting, which and New Zealand’s largest Christmas gift a ‘safety score’ for each site. This is a we expect will reduce lighting energy use collection appeal. Over the last 24 years, the positive performance indicator and is by over 40 per cent. Appeal has collected more than five million intended to drive activities and behaviours Our total carbon emissions were gifts and last year we set a new record, that have a positive effect on reducing estimated to be 311,668 tonnes of CO e, collecting almost 500,000 gifts, $300,000 in injuries. For the year, our TRIFR was 40.79, 2 up 2.6 per cent on last year. Our energy cash donations and $100,000 from the sale up four per cent on last year. use was estimated to be 1.08 petajoules, of Kmart Wishing Tree-branded merchandise. More than 67 per cent of our workforce up four per cent on last year. Our major This Appeal would not be a success without are female and we are focused on energy use was electricity for lighting and the 500 community champions in our stores, increasing their representation in leadership air conditioning. the support of The Salvation Army and roles across our business. The number of the generosity of customers, businesses women in leadership roles has decreased Waste and recycling and communities throughout Australia to 30 per cent this year as we included This year we recycled more than and New Zealand. over 100 team members in error last year. 77 per cent of the waste generated by Through an employee survey, 0.51 per our stores, offices and distribution centres. Our Art of Giving competition continues cent of all of our team members identify As part of the ongoing upgrade of our to grow, with 7,800 students entering themselves as Aboriginal. To further information technology assets, we recycled artwork in the 2010 competition to express increase that representation we continued more than 21 tonnes of computers, ‘what family means to me’. This year, our our work trial program which now provides monitors, printers and checkout equipment. competition focuses on why helping others employment for 19 team members. is important. At the time of writing we have already had over 1,400 entries with winners This year, more than 13,900 team members to be announced in November 2011. received some form of training, with 40,921 hours of training delivered.

50 Wesfarmers sustainability RepoRt 2011 Our customers have continued to support our coin collection program, raising money for Variety, the Children’s Charity; TLC for kids; and local community groups.

The contributions that can be included this year have changed, resulting in us being unable to include $0.10 million in direct support and $1.82 million in indirect support which have been included in previous years. These figures should be added to the verified data to enable accurate comparisons for previous years.

Governance Kmart received 24 enquiries from regulators during the year. A number of these were related to product safety, following the introduction of mandatory reporting to the Australian Competition and Consumer Commission on 1 January 2011. Other enquiries related to issues including fair trading, discrimination and privacy concerns. Kmart classified six as reportable as they alleged some form of regulatory breach or posed a significant risk to the business from a reputational or financial perspective. We responded to all enquiries within prescribed timelines. Throughout the year, Kmart conducted 11 recalls, four of which were for Kmart-branded products.

Ethical sourcing Throughout the year, we undertook a comprehensive review of our ethical Kmart and the community Kmart Burnie customers raised over sourcing program. We worked closely fundraising $2,500 to help the Lions Club of Rocky with Target to align our programs where As part of our coin collection program, Cape with the purchase of an assistance possible and our new code will be launched Kmart stores nominated a community dog for a local autistic boy. Specifically by the end of 2011. This year, 95 factories group or charity within their local community trained by Righteous Pups Australia, gained approval under our existing code, to partner for three months to help raise this specially-trained dog will help Daniel or were approved based on audit results valuable funds and awareness. overcome some of his anxieties and commissioned by one of our peers and Our Australian stores helped to raise over provide him with the constant emotional accepted under our mutual recognition $98,000 collectively, while the majority support he requires. program. In the course of these audits of our New Zealand stores continued to we uncovered no significant breaches raise much needed funds for The Salvation of our code. Army’s Canterbury Earthquake Appeal.

All artwork will be displayed in Kmart stores We also donate products including blankets, once the competition closes, with the winning clothing and toys to assist people in artworks forming the design for the Kmart need and more than 600 team members Wishing Tree Appeal e-cards. volunteered over 4,500 hours to assist with community-based programs throughout Our customers have continued to support the year. our coin collection program, raising money for Variety, the Children’s Charity; TLC Our KTAS team has entered into a for kids; and local community groups. partnership with Rotary Youth Driver Throughout the year, over $475,000 has Awareness (RYDA). RYDA is a not for profit been raised (in addition to the Wishing organisation which delivers road safety Tree Appeal). training to Australian high school students. Kmart store teams continue to support During the year, our business contributed hundreds of schools, kindergartens and $0.74 million in direct support to the community groups by providing Kmart community and $10.57 million in indirect gift cards. support, as verified by LBG.

Wesfarmers sustainability RepoRt 2011 51 Insurance Performance overview

About our business While the financial effect of these events Safety performance Wesfarmers Insurance operates in the has been significant, we have been pleased Lost Time Injury Frequency Rate general insurance and financial services by the response of our claims teams to sector. Our insurance businesses our clients in their time of need. We have 2011 0.83 include Lumley Insurance and WFI in started the new financial year with a 2010 0.89 Australia and Lumley General Insurance strong reinsurance program in place with 2009 2.22 New Zealand (LGNZ). Our insurance continued support from many longstanding 2008 3.7 broking businesses include OAMPS reinsurance partners. Our sustainability as a Australia, OAMPS United Kingdom and business depends on the skills, commitment 2007 2.7 Crombie Lockwood in New Zealand. We and behaviour of our employees in Australia, also have premium funding businesses and New Zealand and the United Kingdom. financial management operations. We are We continue to focus our efforts on represented in 124 locations in Australia, attracting, retaining and developing the best 38 in New Zealand, five in the United Greenhouse gas emissions industry talent and have undertaken key Kingdom and one in New Caledonia. At Tonnes CO2e initiatives to ensure we keep improving our 30 June 2011 we employed 3,684 people. organisational capability. The Wesfarmers For further information on our businesses, 2011 12,789 Insurance ‘My Voice’ survey plays an visit ww w.wesfarmersinsurance. com.au 2010 13,405 important role in influencing our people 2009 12,236 strategy. Key strengths reported this year Year in review include teamwork, supervision, common 2008 12,975 This year, the business reported a 77.1 per purpose and culture and values. Areas for 2007 5,679 cent decrease in earnings before interest, improvement include communication and tax and amortisation from the previous cooperation, performance and feedback, year. This was a result of the impact of an reward and recognition, and learning and unprecedented level of natural disasters development. Our direct contribution to on claims and reinsurance costs. The a range of local community partnerships Energy use number of catastrophe events in Australia supporting initiatives such as farm safety, Petajoules and New Zealand, such as the earthquakes local community welfare organisations and in Christchurch, New Zealand, floods in education was $407,056. 2011 0.08 Queensland and Victoria, Cyclone Yasi 2010 0.08 and other severe weather events around Our total energy consumption was Australia, tested the resilience of the affected 75,579 gigajoules and our greenhouse 2009 0.09 communities and our business. These gas emissions decreased from 13,405 2008 0.08 natural disasters have been extremely to 10,393 tonnes. However, this year 2007 0.04 challenging for the insurance industry for the first time, we have included air and have resulted in a significant number travel emissions, bringing our total to of claims. 12,789 tonnes.

Water consumption Megalitres

2011 80 left: brooke Geary, WFi area Manager, 2010 66 with old mobile 2009 119 phones donated to Mobile Muster. 2008 113 the phones are 2007 n/r recycled, saving them from landfill.

Right: Raising money for prostate Cancer Foundation of australia – ben saunders, Community contribution Jackie Ramsay, A$m arnold tran, Josh ingall, 2011 0.41 0.03 0.44 Patrick O’Connor and sonia DaRos 2010 0.96 0 0.96 from ‘oaMps 2009 0.84 n/r 0.84 team Radelaide’ for the nissan/bRW Direct, in-kind and product Corporate triathlon Community raised contributions supported series 2011. by Insurance

52 Wesfarmers sustainability RepoRt 2011 Insurance – Priorities and outcomes

Environment Stakeholder Community Safety Safety engagement

2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority manage our continue Develop our continue to reduce our LtiFr carbon emissions to support community improve our safety with a target of to minimise our and promote programs management zero Ltis impact on the sustainable to maximise frameworks to environment business benefits to the improve safety outcome practices within communities in across the division our business which we operate outcome and with our outcome employees and outcome business partners Our LTIFR improved from 0.89 to 0.83, Greenhouse gas whichAchieved is a 6.7 Partially per achieved Not achieved emitted by our outcome The ISAFE program cent reduction on operation has Our businesses continues to support last year decreased directly contributed the business. A Achieved Partially achieved Not achieved $ 4 07,0 56 to dedicated specialist Undertook two community healthAchieved and safety Partially achieved Not achieved audits of our WFI held regular activities.Achieved We Partially have achieveda role oversees Not achieved the offices to identify sustainability Achieved Partially achievedsponsorship Not achieved policy program opportunities for committee meetings in place which is improvement and continue to aimed at optimising as part of the drive programs, the benefits to the Energy Efficiency monitor and report local communities in Opportunities (EEO) on sustainable which we operate program. We did not practices purchase carbon credits as we have done in the previous two years

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 53 Insurance continued

Material issues The five week program provides employees Greenhouse emissions • Unprecedented number of catastrophe an opportunity to support Aboriginal Our total greenhouse gas emissions were

events in Australia and New Zealand organisations in the East Kimberley, estimated to be 12,789 tonnes of CO2e, down 4.6 per cent on last year (our total • Increases in catastrophe reinsurance Western Australia. this year includes air travel for the first time). costs Our commitment to creating a safe and This equates to approximately seven tonnes inclusive workplace continues and we • Insurance premium rate increases of CO e per million dollars of revenue, down recognise this is a long-term investment. 2 evident in property classes, particularly 12.5 per cent on last year. The greenhouse Our safety performance continues to on higher risk exposures gas emissions were largely due to electricity improve with an LTIFR rate of less than one. • Federal Government review of natural consumption in our offices. disaster insurance in Australia Environment Energy use The 80 megalitre estimate of our water • Continue to improve our safety Our main energy use during the year related use is based on actual data from our WFI management frameworks to improve primarily to energy consumed as a result Bassendean office in Western Australia safety across the division of electricity consumption in our offices. and LGNZ Auckland office (representing Total energy consumption was estimated • Develop our community programs to 20.5 per cent of our total employees), which to be 75,579 gigajoules, down 6.9 per cent optimise benefits to the communities is used to calculate a per capita water use on last year. Our total energy consumption in which we operate figure that is applied across the remainder per million dollars of revenue was estimated of our business. People to be 43.5 gigajoules, down 9.0 per cent We continue to invest in our people and Several other key environmental initiatives on last year. This energy use is broken fortify our leadership and culture. We in the business include: down into mainly fuel (29.4 per cent of have expanded our internal leadership • WFI’s business improvement program, total energy consumption) and electricity development curriculum and talent ‘Time for Action’, which has led to (42.0 per cent). management processes to ensure robust the introduction of electronic claims succession planning and the identification management and lodgement, is of our future leaders from within. Overall expected to create a major saving in employee engagement scores in the ‘My paper use across the business Voice’ survey increased from 71.8 per cent % to 73.5 per cent, with the most positive • WFI participated in the Mobile Muster 4.6 division-wide scores being recorded for recycling campaign where old phones Greenhouse gas the areas of culture and values; teamwork and accessories are collected for reduction and supervision/leadership. recycling and the proceeds used for community projects. Last financial year, WFI contributed about 26 kilograms of used phones and accessories Governance • implementation of new electronic Our governance framework includes the % operations systems, which has reduced policies and principles that guide our 73.5 paper use across the Australian board and management team as well Employee underwriting operations. In Lumley as a system of controls that defines how engagement Australia, two additional product lines we work. During the year, we continued were released on the my.place@lumley to strengthen the risk management electronic distribution platform for frameworks within each of our businesses. In particular, the Australian underwriting While we continue to invest in the growth insurance brokers businesses undertook a review of the and development of all employees, a • more than 200 employees started systems in place for the identification and particular focus has been made this year participating in a pilot of SameTime, assessment of key risks and implemented on the identification and mentoring of key a unified communication product that a more robust process for the management female talent. We are pleased to report enables desk-based collaboration and and monitoring of insurance risks. that we have met our goal of increasing virtual meetings via audio, video or text. the representation of women at senior levels This software is anticipated to reduce Our New Zealand businesses, Lumley and in our business by at least two per cent. the need for travel to attend meetings. Crombie Lockwood, initiated significant projects to prepare these businesses for As part of our ongoing commitment the introduction of new regulatory regimes to the Wesfarmers Reconciliation which are to apply to the New Zealand Action Plan, this year the business insurance sector and are to be phased nominated two employees to participate in over the next two years. in the Jawun Indigenous Corporate Partnerships program.

54 Wesfarmers sustainability RepoRt 2011 Our community support program is focused on the local communities where our businesses operate. Main: WFi pledged a donation to the RFDs for every client who responded to a client survey. Helen sayers, Market insights Manager WFi (right) presents Joeley Petit-Scott, Public Relations Manager, RFDs with the cheque.

Economic investment During the past year, we made provisions to pay $1,538 million in claims to our customers who suffered insured losses. This included support for customers affected by various natural catastrophes in Australia and New Zealand during the period. We paid $288 million in wages and salaries to our employees. Several other key broking and underwriting strategies and important milestones achieved include: • the acquisition of a New Zealand-based insurance broking business, FMR Risk, by Crombie Lockwood • the successful sale of OAMPS Super • delivering on OAMPS business support improvements, including a new client prospecting tool and other broker information system enhancements • targeted recruitment of specialist brokers to improve our capabilities in OAMPS United Kingdom • enhancements in insurance portfolio management and pricing capabilities across our underwriting business • broadening our Coles personal online insurance offer to include additional services such as 24/7 roadside No significant regulatory breaches were Community assistance recorded by any business within the Our community support program is division. Our businesses self-reported focused on the local communities where • strong take-up on the my.place@lumley, two breaches to relevant regulators and in our businesses operate. Some of the an electronic distribution platform for both instances no action was taken by the community contributions we made during insurance brokers. relevant regulator. the year include: We actively partnered with the Insurance • WFI annually sponsors rural health and Council of Australia and contributed safety information promotions by a submissions on a range of matters leading not-for-profit farm improvement affecting the future of insurance group, the Kondinin Group in Western in Australia, including: Australia. WFI also supports the ‘Day in the Shed’ events in Western Australia’s • changes to the General Insurance Code wheatbelt areas to support the health of Practice, Australian Privacy Principles of country people facing tough times as • improved disclosure of financial services a result of drought. WFI also sponsored products the Women on Farms program • flood insurance, including the National and contributed to the Royal Flying Disaster Insurance Review Doctor Service • the Future of Financial Advice • LGNZ supported a number of its social club fundraising initiatives • consolidation of APRA prudential through dollar for dollar matching and standards. donating prizes for charity auctions to the value of $15,987. These funds were used to support 14 different charitable organisations • OAMPS team members participated in The Bottlemart Smiddy Challenge, The Ballarat Cycle Classic, NIBA mentor program, MOAMPS for Movember and the Global Corporate Challenge.

Wesfarmers sustainability RepoRt 2011 55 Resources Performance overview

About our business This is a reminder that we must continue Safety performance We are a significant Australian open- to focus on preventing workplace incidents. Lost Time Injury Frequency Rate cut miner and a leading metallurgical The central Queensland floods and record coal producer and supplier of thermal 2011 1.29 rainfall during the period September coal for domestic power generation. We 2010 to May 2011 significantly affected 2010 2.14 operate the Curragh open cut coal mine operations at our Curragh mine. This has 2009 2.53 near Blackwater in Queensland’s Bowen not only reduced production but challenged 2008 7.2 Basin, have a 40 per cent interest in the our ability to manage water and broader Bengalla mine in the Hunter Valley of New 2007 3.4 environmental issues on-site. The need for South Wales and, for the reporting period, significant dewatering activities at Curragh operated the Premier Coal mine near Collie has seen a large amount of energy required in Western Australia1. The Bengalla mine is for non-mining related activities, resulting not covered in this report as it is managed in an increase in our energy intensity and a by Coal and Allied and is included in its Greenhouse gas emissions corresponding increase in our greenhouse public reporting. Tonnes CO2e gas emissions. At 30 June 2011 we had 809 people Despite these setbacks, our performance 2011 694,026 permanently employed: 43 at the in regard to our community support, our 2010 715,388 Resources divisional office; 476 at the people and the environment has included 2009 707,725 Curragh mine operation; and 290 at the many successes and highlights such as the Premier Coal operation. The combined 2008 614,619 introduction of an Indigenous Traineeship coal production for Curragh and Premier 2007 834,654 program at Curragh, completion of new Coal was 11.36 million tonnes which was energy efficient housing at Blackwater, the 4.2 per cent lower than the previous year. successful roll-out of SAFEmine (a collision avoidance system) and the completion of Year in review the water treatment plant at Premier Coal. This has been a challenging year on many Energy use fronts for our operations. While we have Material issues Petajoules invested our time and resources into The material issues facing the division improving all aspects of our long-term 2011 4.00 are improving our safety performance sustainability, our performance outcomes in and improving our energy efficiency, 2010 3.94 some areas were less than we had hoped reducing greenhouse gas emissions 2009 4.31 for. This is particularly so this year in safety and water usage. 2008 3.33 where, despite reducing our LTIFR by 40 per cent from 2.14 to 1.29 and achieving 2007 3.51 463 days LTI free at our Premier Coal mine, sadly a contract worker was fatally injured in a single light vehicle incident at our 1 In September 2011, Wesfarmers announced Curragh mine in August 2010. the sale of Premier Coal for $296.8 million. Water consumption Megalitres

2011 2,707 2010 3,402 2009 3,045 2008 3,654 2007 3,869

left: the saFemine system in operation at premier Coal, Community contribution at Collie, Western australia. A$m

Right: premier 2011 0.83 0.04 0.87 Coal’s Toby Ramshaw 2010 0.68 0.03 0.71 inspecting new 2009 0.86 n/r 0.86 electricity meters which assist with Direct, in-kind and product energy efficiency Community raised contributions supported improvements. by Resources

56 Wesfarmers sustainability RepoRt 2011 Resources – Priorities and outcomes

Safety Environment Community Environment Environment Stakeholder engagement

2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority to consolidate continue complete maintain implement complete and improve to improve post handover accreditation to improvements agreement upon our safety greenhouse agreement work AS/NZS iSo 14001 to the waste with Western performance gas and energy around Lake environmental management Australian achieved in measurement Kepwari to assist management strategy at Government for 2009/10 Department of System standard curragh establishment environment and at Premier coal of the Shotts outcome conservation with industrial Park outcome outcome public access to area outcome the lake New electricity outcome DespiteAchieved significantly Partially achieved meters Not were achieved outcome Improvements reducing our LTIFR installed at Premier Two surveillance achieved through and Premier Coal Coal and connected audits of the EMS the provision going 463 days to AchievedSchneider Partially achieved Not achieved were undertaken of a total waste Substantial LTI-free, a fatality ION Powering PartialAchieved surrender Partially of achieved in December Not achieved managementAchieved Partially achievedagreement Not achieved has at Curragh resulted Monitoring the lease and final 2010Achieved and May Partially achievedcontract Not achievedwith SITA beenAchieved reached Partially achieved Not achieved in an unacceptable Software, to allow handover of the lake 2011, with both Environmental between all safety performance the meters to feed has not yet occurred audits identifying Solutions. SITA parties on the for the year data into its online due to issues that Premier Coal provides total waste development of monitoring and involving the State had established solutions through an industrial park. reporting SQL Agreement Act and maintained waste segregation, Final issues are database its management recycling and still being resolved system in line with resource recovery with the State the requirements of the standard

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 57 Resources continued

People Environment This equates to 4.04 kilograms of CO2e per The safety of our people remains our The major focus of our environmental Bank Cubic Metre (BCM), down 2.2 per cent principal focus. This year, our aim was to efforts this year has been related to water. on last year. The greenhouse gas emissions consolidate and improve upon our safety In Curragh’s case it was the result of the were largely due to fugitive emissions of performance achieved in 2009/10. While it record rainfall and floods and in Premier 38 per cent, electricity 29 per cent and was pleasing that we achieved a 40 per cent Coal’s case the need to dewater pits prior diesel 33 per cent. reduction in LTIFR from 2.14 to 1.29 and to commencing mining operations. energy use that Premier Coal achieved 463 days In order to minimise the effect of the floods Our main energy use during the year LTI-free, sadly a contract worker was fatally on the bio-diversity of its mining lease, related primarily to the operation of our injured in a single light vehicle incident at Curragh initiated an awareness and action draglines and coal handling and preparation our Curragh mine in August 2010. This is program to ensure the protection of flora and plant at Curragh and diesel-operated a reminder that we must continue to focus fauna on-site and in surrounding areas. This equipment across the business. Total on preventing workplace incidents. program resulted in a greater understanding energy consumption was estimated to be by employees of the bio-diversity of the 4.00 petajoules, up 1.52 per cent on last environment of the mine. In addition, year. Our total energy consumption per BCM weed eradication and feral animal was estimated to be 24.93 megajoules, up reduction programs started. An animal Roll-out of SAFEmine, 3.1 per cent on last year. This energy use is survey, relocation and voluntary support broken down into fuel of 80 per cent of total a collision avoidance of a research project on the endangered energy consumption and electricity 19 per system Bridled Nailtailed wallabies at the nearby cent with other sources such as explosives Taunton National Park also commenced. accounting for the remaining one per cent. At Premier Coal, an $8 million water Governance This year, Premier Coal successfully rolled treatment plant was completed in October 2010 to support the dewatering of future There were no environmental infringement out a new safety initiative in the SAFEmine notices or fines issued to either Curragh collision avoidance system which has been mining areas. The plant is designed to treat up to 70 megalitres of water per day with or Premier Coal. During the year, Premier installed and implemented on all mobile Coal had two non-compliances. One of mining machinery and vehicles entering the clean water discharged into the east branch of the Collie River. these events was due to a monthly water the mine operation, including contractor sample from a licence point not being vehicles. Premier Coal is the first major taken while the other was for blast noise site in Australia to roll-out the SAFEmine exceeding the Environmental Protection technology. (Noise) Regulations. To date the Department Our Aboriginal employment and engagement of Environment and Conservation has not strategy continued to make progress 70mL advised Premier Coal that any further action will be taken on these non-compliances. with initiatives across all operations. This Recycled water treated was highlighted by Curragh’s Indigenous Traineeship program in partnership each day Community with The Salvation Army Employment When central Queensland was devastated Plus, state and local governments and by floods during the reporting period, our contracting company, Thiess. Carbon and energy employees at Curragh contributed to the The management of greenhouse gas emergency response by assisting with the In a major step forward for the standard emissions and energy use remains one of movement of people via chartered coaches of living for our Curragh employees, the the most challenging areas for our business. and aircraft, as well as moving supplies construction of 19 two-storey houses Improved measuring capability such as in the local area to where they were most and 14 apartments has commenced the introduction of new electricity meters needed. While this in-kind support was well- in Blackwater. at the Premier Coal mine and the further received, the impact of the floods ensured a Our commitment to attracting, engaging refinement of WESGERS is assisting our major rebuilding effort was required, and the and retaining our people has seen the various operations to better understand division and its employees made significant introduction of a division-wide employee their emission profiles and energy use. financial donations. survey to get feedback from our employees While progress has been made in this area, In June 2011, the Ngalang Boodja Mine on what they think is important, how we the record rainfall and floods in central Lake Aquaculture Project achieved a are performing and what we can do better. Queensland have seen Curragh undertake major milestone with the first commercial This survey is now driving an action plan a very significant dewatering program. harvest of marron and the opening of Collie to enhance the working environment for This has resulted in additional energy being Valley Marron. our employees across all sites. Investing used for non-mining operations which has in the development of our people remains reduced our energy efficiency and increased The Brisbane office, Curragh and central to our approach. This year’s focus our greenhouse gas emissions at that site. Premier Coal operations continue to on women in leadership, succession and make substantial contributions to their development planning and employee Greenhouse emissions communities, supporting local health Our total direct (Scope 1 and 2) engagement is key to achieving our goal services, education, the arts, Aboriginal greenhouse gas emissions were estimated of being a great place to work. employment opportunities and local to be 649,374 tonnes of CO2e, down tourism initiatives. 3.43 per cent on last year. 58 Wesfarmers sustainability RepoRt 2011 Since it commenced operations in 1983, Curragh has always been synonymous with quality housing for its employees.

Main: new housing for Curragh employees at blackwater, Queensland.

Housing for the 21st Century This method of construction is highly to complement the local climate but Since it commenced operations in 1983, sustainable; off-site constructions, or support an indoor/outdoor lifestyle. Curragh has always been synonymous buildings constructed within a factory Landscaping will be an important feature with quality housing for its employees. environment, have the potential to reduce of the development, using plants native to Curragh established a new benchmark in waste by up to 30 per cent. the area such as Tuckeroos. These quick the provision of housing purpose-built for Significantly, further environmental benefits growing trees will feature throughout the the mining industry, a standard which it has are realised through energy and water development, maintaining a cool outdoor proudly maintained since those early years. efficient construction, noise limitation and space for most of the houses and the However, with an expanding workforce dramatically reduced vehicle movements apartment grounds. this year, Curragh announced a new during construction. The project is being undertaken in a way housing development for employees and Climate responsive elements were that supports local businesses and jobs, their families in Blackwater. Construction incorporated into the building design, as well as ensuring the needs of the commenced in March 2011 of 19 two- resulting in an average rating of 6.1 Stars workers and their families are met, that storey houses and 14 apartments. With issued by Sustainability House. The high the buildings are energy efficient and that quality family and single accommodation thermal energy efficiency rating significantly waste minimisation is a focus throughout in scarce supply this housing project is a reduces the requirement for heating construction. very welcome addition to the Blackwater and cooling to maintain a comfortable community. environment. There has been an emphasis The design and construction was placed on functional floor plans and the undertaken by Panorama Property Group use of space within each residence. Pty Ltd, a central Queensland property Large bedrooms, each supplied with development and construction company. individual ensuites, will cater to the unique The housing project uses modular accommodation requirements of mining technology, with individual modules communities. Privacy will be maintained constructed off-site and delivered to the with screening and landscaping designed location complete with fixtures and fittings.

Wesfarmers sustainability RepoRt 2011 59 Chemicals, Energy Performance overview and Fertilisers

About our business In November 2010, CSBP released the Safety performance Wesfarmers Chemicals, Energy & Fertilisers Public Environmental Review document for Lost Time Injury Frequency Rate (WesCEF) operates chemical, gas, power its proposed ammonium nitrate expansion generation1 and fertiliser businesses that project for a 10-week public consultation 2011 4.59 service sectors in both Australian and period, and held a public information 2010 3.82 overseas markets. evening about the proposed project in 2009 2.60 Our division was created following the December 2010. The WA Environmental 2008 4.05 Protection Authority released its report merger of the Energy, and Chemicals and 2007 1.83 Fertilisers divisions, announced in April and recommendations for this project in 2010. As this is our first year of reporting July 2011 and the ministerial statement was as WesCEF, historical data was created signed by the Western Australian Minister by combining data previously reported for Environment in October 2011. separately by the two divisions. In February 2011, CSBP started trials of Greenhouse gas emissions Tonnes CO e We have a 50 per cent interest in an nitrous oxide reduction technology in one 2 of its nitric acid plants at Kwinana (Western ammonium nitrate facility in Queensland 2011 2,022,741 (QNP), but we do not operate the business Australia) to help reduce greenhouse 2010 2,024,587 and it is not included in this report. gas emissions. In 2009/10, nitrous oxide emissions represented approximately 2009 1,862,605 We have operations around Australia, and 46 per cent of the division’s total carbon 2008 1,811,792 employed 1,472 people as at 30 June 2011. dioxide equivalent (CO e) greenhouse 2 2007 1,461,880 Our revenue in 2010/11 was $1,641 million. emissions.

Year in review CSBP also completed design work and We continued our focus on the sustainable started fabrication of a regenerative thermal operation of our businesses for the benefit oxidiser that will broaden supply options of our employees, our customers and the for our superphosphate manufacturing Energy use communities in which we operate. We operation at Kwinana, and help reduce Petajoules remain committed to the safe operation dependence on phosphate rock from 2011 18.25 of our facilities in a way that minimises Western Sahara. 2010 17.93 any adverse impact. Kleenheat Gas completed a trial of American Power Group’s patented dual-fuel 2009 15.16 system that converts existing diesel engines 2008 17.88 in heavy vehicles to operate on a blend 2007 14.59 of diesel and LNG. This provides lower operating costs and reduced emissions through the displacement of diesel by LNG.

1 On 31 August 2011, Wesfarmers completed Water consumption the sale of enGen for $101 million. Megalitres

2011 4,220 2010 4,143 2009 3,591 left: the regenerative thermal 2008 3,630 oxidiser unit being 2007 2,455 lifted into position at WesCEF’s fertiliser operations in Kwinana, Western australia. Community contribution Right: The Salvation A$m Army’s Captain Katie Beardsley 2011 0.29 0 0.29 receives a $5,000 cheque from 2010 0.44 0.01 0.45 Kleenheat Gas 2009 0.69 0 0.69 General Manager Graham smith as Direct, in-kind and product part of Kleenheat’s Community raised contributions supported partnership with by Chemicals, Energy and Fertilisers The Salvation Army Data from 2007 to 2010 has been restated to reflect Regional Care the merge of Energy, and the Chemicals and Fertilisers program. divisions in July 2010.

60 Wesfarmers sustainability RepoRt 2011 Chemicals, Energy and Fertilisers – Priorities and outcomes

Safety Safety People Environment People Community

2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority to improve to improve to improve to continue to to integrate to contribute to the overall compliance to training materials manage legacy and improve and engage with participation of regulations of and delivery to waste and documentation the communities in our workforce all major hazard support the initial contamination and the systems which we operate in health and facilities (mHF) induction, skill issues that facilitate safety activities and develop our development and their access outcome such as hazard KPis to track competence of outcome identification, process safety our workforce outcome inspections and performance risk assessments outcome Community support outcome Groundwater activities continued outcome monitoring at A new document We continued our CSBP’s site in management membership and Bayswater (Western systemAchieved was Partially achieved Achieved Not achieved Partially achieved Not achieved Two new training involvement with Australia)Achieved continued Partially achieved implemented Not achieved at Safety reports advisors were key industry bodies We increased our approved by appointedAchieved for Partially achievedand Notenvironmental achieved the Kleenheat focus on safety regulators for Kleenheat Gas remediation reports production facility A public information metrics in our our ammonia/ were drafted in Kwinana, and evening was held A manager was businesses which ammoniumAchieved nitratePartially achieved Not achieved work to introduce at CSBP Kwinana appointed to Contaminated soil ledAchieved to increases Partially achievedand Kleenheat Not achieved Gas the system to other to provide details improve training for was excavated in team safety production facilities parts of Kleenheat about our proposed fertiliser operational from CSBP’s meetings, risk Gas commenced ammonium nitrate Work is underway and maintenance site in Bunbury, assessments, task expansion project on safety reports for employees Western Australia observations and A customer Kleenheat’s Deer Investigations hazard identification Training modules and community Park (Victoria) facility, of historic in the workplace for operators in information and Australian Vinyls contamination at sodium cyanide and campaign was in Laverton North, CSBP Kwinana fertilisers operations implemented Victoria continued were updated to support the Australian Gold Divisional leadership shutdown of the Reagents achieved programs were Tempered Liquid recertification with the launched nationally Petroleum Gas International Cyanide (TLP) reticulation Management system in Armidale, Code (ICMI) New South Wales

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 61 Chemicals, Energy and Fertilisers continued

We have previously reported on the We increased our focus on safety metrics Water use performance and expansion of our nutrient- in our businesses which led to increased Our total water consumption was 4,220 stripping wetland at CSBP Kwinana. This team safety meetings, risk assessments, megalitres, up two per cent on last year. year, we successfully trialled the addition of task observations and hazard identification We continued our use of recycled water organic carbon in the wetland to enhance in the workplace. We also introduced at CSBP Kwinana, and Australian Vinyls the removal of nitrogen from wastewater additional safety scorecards at CSBP. used 130 megalitres of recycled water prior to discharge from site. We started a phased introduction of a new from its recycled water plant that was safety incident reporting tool, Cintellate, commissioned in February 2010. Material issues to replace existing systems and provide Our material issues are: a single incident, action management Governance • continuing to improve workplace safety and inspection/audit tracking tool across Our Health, Safety and Environment team provides guidance and advice to • minimising greenhouse gas emissions, the division. our businesses on current and changing and further improving energy efficiency We started developing skills and training legislative and public policy requirements, matrices within the Kleenheat Gas • ensuring the efficient use of water in our and supports them in complying with business, as well as new technical training operations, including the use of recycled these requirements. and reclaimed water supplies modules for the Kleenheat Gas production facility operators. As part of our operations, we manage • continuing to develop, engage and retain several major hazard facilities (MHFs), our employees Environment and manufacture, handle and transport • continuing to contribute to and engage We continued a review of our environmental dangerous goods. with the communities in which we operate. management systems, including the review Australian Gold Reagents achieved and assessment of our environmental risks. recertification with the International People Kleenheat continued to participate in Cyanide Management Code covering As at 30 June 2011 we employed the WA Contaminated Sites Committee the manufacture, transport and use of 1,472 people, excluding contractors proceedings for determining responsibility sodium cyanide. but including casual employees. for contamination at an Osborne Park In January 2011, our sodium cyanide The ongoing development of our people (Western Australia) site, formerly occupied business received a formal letter of warning is one of our key priorities, and during the by Kleenheat (among others). from the Department of Environment and year we launched our Capability Framework Emissions notifiable under the National Conservation (DEC) in Western Australia for which focuses on leadership development, Pollutant Inventory (NPI) were estimated, failure to ensure the accuracy and reliability talent management and the development and data for the 2009/10 reporting period of NOx data for a minimum of 90 per cent of of core competencies. was submitted to government. Detailed the operating time for the month of February information is available at ww w.npi. gov.au 2010 from one of our sodium cyanide liquid production plants at Kwinana, as reported in Carbon, energy and water last year’s Sustainability Report. Greenhouse emissions 20.3% Our 2010/11 Scope 1 and 2 greenhouse gas emissions were estimated at 1,875,740 Reduction in TRIFR tonnes of carbon dioxide equivalent (CO2e), a decrease of 2.8 per cent on last year. Of % this, 46 per cent was generated from nitric 2.8 acid production, 25 per cent from ammonia Greenhouse gas During the year, we employed six apprentices production, seven per cent from natural reduction and sponsored an additional 11 in our gas and diesel use in our power stations, businesses. and seven per cent from LPG and LNG We introduced the WesCEF Women production. The balance was generated During the year, CSBP reported to the Forums (27 per cent of our employees from various other processes associated DEC that a loss of containment of nitric are female), and developed the division’s with our operations. acid occurred at CSBP Kwinana in September 2010, and also reported that Aboriginal Strategy. An Aboriginal cadetship In addition, Scope 3 emissions associated the accuracy and reliability of data collected commenced in the division in June 2011, with our electricity, natural gas, liquid fuel, for a sodium cyanide liquid production and recruitment is currently underway for waste and air travel were estimated to be plant NOx analyser at Kwinana in March a Coordinator, Aboriginal Affairs. 147,001 tonnes CO e. 2 2011 was below licence requirement. In 2010/11, we recorded 55 Total energy use The DEC is yet to respond to these events. Recordable Injuries (TRIs), 16 of which Our net energy consumption was estimated CSBP has undertaken actions to address were Lost Time Injuries (LTIs). This to be 18.25 petajoules, up two per cent on these events. compares to 83 TRIs and 16 LTIs last year. last year. Our energy use is represented Our Total Recordable Injury Frequency by natural gas (79 per cent), LNG (nine Rate decreased from 19.79 to 15.77, while per cent), and diesel (six per cent), with our Lost Time Injury Frequency Rate other energy making up the remaining increased from 3.82 to 4.59.* (six per cent). * 2009/10 data includes Coregas. 62 Wesfarmers sustainability RepoRt 2011 If the initial results of the trial prove successful, a similar catalyst will be installed in the other nitric acid plant at CSBP, Kwinana. Main: Csbp process engineer Moiz alibhai in front of the nitric acid plant in which Csbp is currently trialling nitrous oxide abatement technology.

Community We provided support to more than 150 organisations in 2010/11 through direct financial support or through the donation of goods. WesCEF continued support of Youth Focus, The Salvation Army, the Asthma Foundation of Western Australia and the Clontarf Foundation. In January 2011, we announced the shutdown of the 110-year-old TLP gas reticulation system in Armidale, New South Wales. An extensive information campaign was undertaken to provide both customers and the community with information about the shutdown, and a range of subsidies and incentives were offered to help customers convert to LPG alternatives. In late 2009, we announced an investment of almost $5 million in a regenerative thermal oxidiser (RTO) to broaden phosphate rock supply options for our superphosphate manufacturing operation at Kwinana and reduce our dependence on phosphate rock from Western Sahara. Fabrication has started, and the RTO is expected to be commissioned in late 2011. During the year, we continued to engage in dialogue with interested parties Reducing greenhouse gas emissions The decision to trial the technology was regarding the importation of phosphate Nitrous oxide is a greenhouse gas emitted announced in November 2010, ahead rock from Western Sahara, and welcomed during the production of nitric acid, which of the Federal Government’s climate an invitation to meet with the International is produced as a feedstock for ammonium change framework announcement in Officer for the Forum for the Future for nitrate production. Each unit of nitrous February 2011. Saharawi Women during her visit to Perth oxide emitted is equivalent to 310 units The catalyst converts nitrous oxide to inert in May 2011. Unfortunately, the meeting of carbon dioxide. nitrogen and oxygen. If the initial results of invitation was withdrawn. In 2009/10, nitrous oxide emissions the trial prove successful, a similar catalyst represented approximately 46 per cent will be installed in the other nitric acid plant of our division’s total carbon dioxide at CSBP Kwinana. equivalent (CO e) greenhouse emissions. 2 If successful, this could potentially reduce In February 2011, CSBP started a trial the division’s total greenhouse gas of new nitrous oxide abatement catalyst emissions by more than 700,000 tonnes technology in one of its two nitric acid per year. plants at Kwinana to help reduce our total greenhouse gas emissions.

Australian Vinyls identified a number of During the year, Kleenheat Gas received corrective actions following the investigation two remediation notices from the of a minor injury resulting from the use Department of Mines and Petroleum in of a catalyst X16 (Ethyl Chloroformate). Western Australia regarding its Beach These actions became the subject of Street site in Kwinana. Both notices an improvement notice following the were complied with. provision of the information associated Kleenheat Gas also received three with the incident to Worksafe Victoria. directives from the Hazardous Industries All actions have been undertaken and and Chemicals Branch, Workplace Health therefore the improvement notice has and Safety in Queensland regarding its been complied with. Pinkenba site. Actions to comply with these three directives are underway and on track to be completed by their due dates. Wesfarmers sustainability RepoRt 2011 63 Industrial and Safety Performance overview

About our business • using third party certified paper for Safety performance* We are Australia and New Zealand’s regular marketing publications and Lost Time Injury Frequency Rate leading supplier of industrial and safety internal use 2011 2.34 consumables. We provide engineering • continuing The Fred Hollows Foundation products and industrial consumables, partnership with contributions of more 2010 1.61 safety, packaging, materials handling, than $100,000 2009 2.4 lifting products and services, and industrial, 2008 4.6 medical and specialty gases to industry • a 16 per cent reduction in printing and government. We operate a multi- per million dollars of revenue from 2007 4.6 channel distribution model that includes a the 2009 baseline network of branches, sales representatives, • an immediate response by employees e-business, websites and telesales. to the floods and cyclones in australia Greenhouse gas emissions* With 219 outlets and 121 gas distribution and earthquakes in Christchurch, Tonnes CO e points, we trade in Australia as Blackwoods new Zealand. 2 (incorporating Blackwoods Electrical 2011 243,071 and Bakers Construction and Industrial), Material issues 2010 30,014 Protector Alsafe, Bullivants, Total Fasteners, As a supplier of industrial and safety and Coregas. In New Zealand, we trade as consumables, our material issues are: 2009 25,231 Blackwoods Paykels Protector, Packaging • the sustainability of the supply chain, 2008 33,546 House, NZ Safety and Safety Source. As at including ethical labour standards 2007 29,533 30 June 2011 we employed 3,529 people and the environmental impacts of (including casual employees). manufacturing products • the safety and diversity of our people Year in review Energy use* and our own operational environmental The pursuit of outcomes that are socially Petajoules and environmentally responsible, while impact including greenhouse gas being economically viable, continues to emissions and waste 2011 1.21 be our focus. Key sustainable outcomes • delivering safe and sustainable products 2010 0.19 during the reporting period included: and services to customers on time 2009 0.19 to help them meet their business • the introduction of 66 fuel efficient 2008 0.20 objectives. hybrid vehicles 2007 0.18 • the continued implementation of safety projects such as forklift safety, goods stored at height, work in remote areas and pre-employment functional Water consumption* assessments Megalitres

2011 254 2010 63 2009 55 2008 n/r 2007 n/r

Community contribution* left: Growth through a diverse A$m workforce is a priority. 2011 0.38 0.93 1.31 Durmy Mustafa 2010 0.17 0.04 0.21 and Claire stock. 2009 0.13 0.05 0.18 Right: internal safety audits help Direct, in-kind and product reinforce our safety Community raised contributions supported culture. blackwoods by Industrial and Safety employees from left, John pignone, Marcel Moussa, Kelly Watson and * 2011 data reflects the inclusion of Coregas in the lee bateman. Industrial and Safety division in July 2010.

64 Wesfarmers sustainability RepoRt 2011 Industrial and Safety – Priorities and outcomes

Safety Community Environment Stakeholder Stakeholder engagement engagement

2010 Priority 2010 Priority 2010 Priority 2010 Priority 2010 Priority continuing to continuing to drive conserving Further promoting managing drive a safety our Aboriginal resources with a a sustainable efficient, focused culture and torres Strait focus on energy product range to sustainable and islander Strategy efficiency and help customers ethical outcomes and expand our waste reduction meet their with suppliers to outcome employee diversity sustainability reduce risk and initiatives objectives deliver value to outcome customers The total recordable outcome outcome injury rate decreased outcome to 27.78 in 2011 Introduced 66 fuel from 29.10 in 2010 efficient hybrid Achieved Partially achieved Not achieved vehicles Implemented safety Incorporated Promoted products greater cultural with sustainability projects for forklifts, Established a Updated and awareness through Achieved Partially achievedcredentials Not achieved on goods stored at working group improved the initiatives relating to the Blackwoods height, work in to identify and supplier survey induction, internal website.Achieved Developed Partially achieved Not achieved remote areas and implement energy to manage risks communicationsAchieved Partially and achieved Not achieved a range of waste Achieved Partially achieved Not achieved pre-employment efficiency and in ethical sourcing, employee participation management and functional renewable energy dangerous in secondment recycling signs for assessments projects goods, safety, programs sale to customers trade practices Reduced our legislation and other Support for The Fred printing per million sustainability risks Hollows Foundation dollars of revenue continued, with by 16 per cent from Implemented use of contributions of over the 2009 baseline third party certified $100,000 paper for internal use and marketing Developed an action publications plan focused on women in leadership, which increased the number of women in the management team

Achieved Partially achieved Not achieved Wesfarmers sustainability RepoRt 2011 65 Industrial and Safety continued

People • 108 employees completed Certificate Safety continued to be a focus for the iii and iV in transport and logistics business through implementation of the programs with a further 77 employees following projects: currently enrolled. 66 • Improved forklift driver training and a Bullivants also introduced a technical Energy efficient hybrid successful pilot of technology solutions, service representative accreditation system. such as swipe card access, monitoring Bullivants’ inspectors make decisions on vehicles introduced operator licences, impact sensors, whether lifting or rigging equipment is fit for into the fleet speed limits, and reporting to improve purpose, and this accreditation system gives forklift safety customers confidence in the qualifications Our printing per million dollars of revenue of our inspectors. The accreditation system • Improved safety for employees working in decreased by 16 per cent since 2009 also provides a pathway for employees remote areas with vehicles now equipped through the introduction of wireless pursuing technical skills. with two spare tyres, long range fuel warehousing, electronic transactions with tanks, emergency beacons, overhead Diversity customers and suppliers, and operational lights, bull bars, spotlights, recovery The Aboriginal and Torres Strait Islander print reduction initiatives. Third party winches, fire extinguishers, dual batteries, Strategy progressed with assistance from certified paper is now used for marketing two way radios, visibility flags, snorkels, the steering committee to improve cultural publications and internal use. We also and satellite navigation systems awareness within our business. During the implemented cardboard balers to improve year, employee induction materials were • Revision of the safe operating procedure recycling at our NSW distribution centre. updated with cultural awareness content for goods stored at height to reduce risk. To help our customers be more and a ‘Welcome to Country’ was held at sustainable we developed a range of waste the official opening of the new Protector management and recycling signs. The signs Alsafe Mackay branch. are made from 50 per cent recycled plastic Blackwoods contributed more than and can also be recycled. The sustainability 19% $100,000 to The Fred Hollows Foundation attributes of products, which have been by donating a percentage of sales from Safety audits verified with third party certification, are the Foresight range of products. Five now promoted on the Blackwoods website. increased employees visited communities in the Northern Territory to participate in The Governance Fred Hollows Foundation programs, We remain committed to ensuring that our The safety culture was reinforced with the such as health, literacy, nutrition, and businesses and suppliers are compliant number of internal safety audits increasing development training programs. As part with appropriate legislation and our values. by 19 per cent for the reporting period of the ‘Jawun’ secondment program, The Australian and New Zealand supplier compared to the previous period, including one employee helped the Wyndham survey in 2011 was reviewed to assist us 51 audits by the executive leadership team. Early Learning Activity Centre in the East in better managing risks in ethical sourcing, Kimberley obtain funding. Blackwoods is dangerous goods, safety, trade practices Total hours worked increased by also a major sponsor of training programs legislation and other sustainability risks. 14 per cent, which contributed to an to help indigenous people obtain skills In addition, we continued to work with increase in total injuries and our LTIFR necessary for employment in the mining our international suppliers to improve the increased to 2.34 compared to 1.61 for industry in partnership with BHP Billiton sustainability of our sourced products by the previous reporting period. However, Olympic Dam and Xceptional Recruitment. auditing all our major Asian suppliers of our the severity rate improved to 38.39, down own branded products. from 47.85 for the previous reporting period, Environment In addition, Bullivants successfully completed and the Total Recordable Injury Frequency We introduced 66 energy efficient an audit program to demonstrate compliance Rate (TRIFR) improved to 27.78 from 29.10 hybrid vehicles into our fleet to reduce to management standards for quality for the previous reporting period. fuel consumption and greenhouse gas (ISO 9000), environment (ISO 14001) and We continued to support employees emissions during the reporting period. An safety (AS 4801). with training and development during the internal working group was established to reporting period including: identify energy efficiency and renewable energy projects, which resulted in the • 1,236 instructor-led training courses implementation of a pilot project for efficient that covered sales, first aid, forklift, warehouse lighting. We worked with Low hazard management and safety training Carbon Australia, an independent company • 35 managers participating in created by the Australian Government, to residential regional and branch identify lights that meet the objectives of manager development programs energy efficiency, light quality and cost.

66 Wesfarmers sustainability RepoRt 2011 Every time our customers purchase products from the Foresight range, a percentage of the proceeds go directly Main: outback eye screening enabled by the to The Fred Hollows Foundation. Fred Hollows Foundation is just one of the initiatives benefiting from the blackwoods partnership – photo courtesy of the Fred Hollows Foundation.

Community During the year, we continued to support a number of key partners and community groups, with a total direct contribution in Australia and New Zealand of more than $380,000 and an indirect contribution of over $930,000. Direct contributions included $50,000 passed directly to organisations contributing to Queensland flood relief. We also facilitated the delivery of over $870,000 of suppliers’ products, which included industrial, safety and cleaning products for use by emergency services and volunteers. Additionally, Protector Alsafe continued to support the KIDS Foundation in Australia, which promotes childhood injury prevention, with fundraising activities for Injury Free Day and donations of over $30,000. Coregas continued to sponsor the Tradesperson of the Year award through the Welding Technology Industry Association in Australia. In New Zealand, we supported the Cancer Society, Surf Life Saving New Zealand, and continued to support a breeding program for the endangered Hihi bird at Tiritiri Matang Island, New Zealand. The Fred Hollows Foundation – The ‘See Australia’ trip gave the a successful partnership employees an opportunity to witness In 2010, Blackwoods established a first-hand the range of activities partnership with The Fred Hollows conducted by The Fred Hollows Foundation to support its Indigenous Foundation, including programs for Australia program, which delivers health health, nutrition, literacy education services to Aboriginals in some of the and development. most remote parts of Australia. The The six-day trip included visits to Foundation is committed to roles as both remote communities and meetings partner and advocate of health programs with community leaders of local health for indigenous Australians. To support organisations such as the Sunrise Health the Foundation, Blackwoods established Service, which was developed to meet the Foresight range of products. Every the mental, cultural and emotional needs time our customers purchase products of the people in the East Katherine region. from the Foresight range, a percentage The ancient rock art in the national parks, of the proceeds go directly to The Fred the dreamtime stories from tribal elders, Hollows Foundation. The Foundation is a helicopter ride over the Eva Valley, a also supported by employee donations boat trip through Katherine Gorge, and and branch fundraising activities, such eating kangaroo tail cooked on fire coals as on-site barbeques. all contributed to a greater appreciation In May 2011, five Blackwoods employees of the Aboriginal culture for participants. were selected for the Foundation’s ‘See Our employees were inspired by the work Australia’ trip to the Northern Territory of The Fred Hollows Foundation and based on their contribution to the are now advocates in their respective community and our business. Blackwoods regions for the great work and real improvements our donations are making to Aboriginal communities.

Wesfarmers sustainability RepoRt 2011 67 About this report

This is our fourteenth Sustainability Report, developed to share our company’s philosophy and commitment to sustainability. The report’s objective is to provide information about the economic, environmental and social impact of Wesfarmers and the businesses we operate.

What this report covers Report preparation The executive summary of the Net Balance Information contained in this report is for community contribution report, dated July 2011, is available on our the financial year ended 30 June 2011. Wesfarmers’ community contribution website at www.wesfarmers.com.au/ All wholly-owned and/or operationally- has been verified using the London sustainability managed businesses are included. Each Benchmarking Group (LBG) methodology. To the extent specific material issues of our divisions has a specific section in Safety data were raised in that process, we have this report. Other part-owned businesses As with the other data in this report, safety endeavoured to respond to them in this such as the Bengalla coal mine in New and workers’ compensation data is for report. Our divisions report on the material South Wales, Wespine softwood sawmill the year ended 30 June 2011. However, sustainability issues for their business in Western Australia, and Queensland the data reported for a particular year in their individual sections of this report. Nitrates Pty Ltd in Queensland are can change in subsequent reports as Of the report recommendations that we grouped in the Wesfarmers section of the circumstances (such as the duration of have not addressed completely, a Group report and we provide links to websites time lost from work) can change over time. Sustainability policy, based on our five for readers wishing to find out more about Lost Time Injury Frequency Rate (LTIFR) principles, is in preparation and while our their activities. includes contractors where possible and businesses have many internal targets for Each division reports across the five key unless otherwise specified. sustainability metrics our preference is to principles of our Group-wide approach Greenhouse emissions be judged on our performance over time to sustainable business: people; carbon Greenhouse emissions information and the continual improvements we strive and energy; community partnerships contained in this report for Australia to make. and contributions; net environmental is based on the National Greenhouse In terms of our stakeholder engagement footprint; and economic development. and Energy Reporting (Measurement) processes, these are dealt with at the Where possible, we have reported Determination 2008 (NGER Act), although appropriate Group or business level. this as both aggregated data for the for indirect emissions (such as Scope 3 Every one of our businesses has a complex Wesfarmers Group, as well as showing electricity emissions, waste and air travel network of stakeholders across regulatory divisional unit data. These indicators not included in the NGER Act) calculations agencies, community partners, consumer and their measurement were developed are done in accordance with the National advocacy, industry bodies, civil society, with the assurance providers for this Greenhouse Accounts Factors Workbook – suppliers and customers that are consulted report and we use the Global Reporting July 2010 (which applies for the 2010/2011 with according to their needs or our Initiative (GRI) framework as the base for year). Emissions for other countries requirements. To describe this situation information in this report. are calculated according to relevant accurately in this report would require us government standards in those countries. to commit several pages to the subject. What we mean by sustainability Our preference is for readers interested in Wesfarmers’ objective is to provide Stakeholder engagement a particular area of our activity to contact value to our stakeholders, primarily Wesfarmers and its businesses continually the corporate office or our businesses as through providing satisfactory returns to engage in a significant communication relevant to discuss their interest and obtain our shareholders. We believe to do this process with stakeholders with widely relevant information. The initial contact effectively involves focusing on the five varying interests. As part of this report, details can be found at www.wesfarmers. key principles outlined above. Wesfarmers (through Net Balance, the external assurers, to maintain independence com.au/contact in analysis and reporting) conducted a broad-based survey of approximately Assurance 100 significant stakeholders of the The internal and external assurance organisation (investors, analysts, business process is an important part of Wesfarmers’ associations, non-government public commitment to transparent reporting of advocacy bodies, and business journalists) its activities. to gather their views on Wesfarmers’ approach to sustainable business.

68 Wesfarmers sustainability RepoRt 2011 internal verification Net Balance, as detailed in its assurance The Wesfarmers Annual Report also details Every effort is made to ensure that all report, relied on this audit for our NGER Act the structure of the organisation; operating statements in the report are accurate and data, and conducted its own assurance of locations; major shareholdings; markets; authenticated. Each division documents our greenhouse and energy data outside countries and sectors we operate within; original source material linking to the the scope of the NGER Act report. and any legal changes to subsidiaries content in the report. Extensive verification during the reporting period. checks were made by representatives More information In several parts of this report the reader from our Corporate Solicitor and Group In addition to this report, more information will note references to more detailed Insurance departments, who subsequently regarding Wesfarmers’ activities can be information on particular elements of prepared reports for senior management found in other public reports: our performance being available on our within each business. • the Carbon Disclosure Project and website at www.wesfarmers.com.au/ external assurance the Carbon Disclosure (Water) Project sustainability Net Balance Management Pty Ltd (Net (ww w.cdproject. net) This data includes a list of the industry Balance) carried out an independent • the Dow Jones Sustainability Index associations or like bodies Wesfarmers assurance on this report using the (ww w.sustainability-index .com) or its subsidiaries was a member of AA1000 Assurance Standard 2008 and in 2010/11. the elements of the Global Reporting • the Australian Packaging Covenant (ww w.packagingcovenant. org.au) Initiative (GRI). The Assurance Statement Completeness is published on page 70. Net Balance • the Energy Efficiency Opportunities Act We do not claim that this report provides provides a detailed report to management (ww w.energyefficiencyopportunities. 100 per cent coverage of our sustainability and meets with the Board’s Audit gov .au) in Australia performance. Any gaps in our knowledge Committee to review its assessment of will be reduced as our systems improve. the reporting process. • the National Greenhouse and Energy Reporting Act in Australia (ww w. This document is a best-endeavours Net Balance has checked our reporting and climatechange. gov.au/reporting/) attempt to report openly and honestly confirmed it to be Application Level B+. based on our current state of knowledge. • the Forest Footprint Disclosure Report A statement supporting our verification to (ww w.forestdisclosure. com). Feedback GRI Level B+ (as in 2010) is located on our We welcome your feedback on this report. website at www.wesfarmers.com.au/ In most cases, each of the Wesfarmers A form has been provided for you on the sustainability divisions publish their own sustainability reports which are available on their inside back cover, or you can email The greenhouse gas emission and websites. [email protected] energy data has been subject to a limited Last year, we received several formal assurance audit by Ernst & Young to This report uses only summarised comments, which we responded the extent the data relates to our NGER financial and governance information. to individually. Act report for the 2010/11 year and the More information and detail is available Auditor’s report has been voluntarily in our 2011 Annual Report (available at provided to the DCCEE. www.wesfarmers.com.au), especially regarding Board processes and policies; remuneration policies; and financial accounting practices.

Verification Statement from LBG Australia/New Zealand We have verified Wesfarmers Limited’s application of the London Benchmarking Group (LBG) model to measure and report on corporate community involvement activity. The LBG model helps businesses improve the measurement, management and reporting of their corporate community investment programs. It covers the full range of contributions (cash, time and in-kind donations) made to community causes, and assesses the results achieved for the community and for the business. As managers of LBG Australia/New Zealand, we have worked with Wesfarmers Limited to review its understanding and application of the LBG model in respect of the wide range of community programs supported. Our aim has been to ensure that the evaluation principles have been correctly and consistently applied. Having conducted an assessment, we are satisfied that this has been achieved. Our work has not extended to an independent audit of the data.

Yvonne Choong LBG Manager, October 2011

Wesfarmers sustainability RepoRt 2011 69 Independent Assurance Statement

To the Directors of Wesfarmers Limited: This involved assessing the organisation’s a comparison of Wesfarmers and its business divisions against their peers, Wesfarmers Limited (Wesfarmers) adherence to the AA1000 AccountAbility a risk review, an industry review, a review commissioned Net Balance Management Principles (2008) and assessing the of selected australian media reports and Group Pty Ltd (Net Balance) to provide accuracy and quality of the sustainability a policy review. independent assurance of this Sustainability information contained within the Report. Report (the Report). The Report presents The review of adherence to the principles • Interviews with senior managers to better Wesfarmers’ sustainability performance was undertaken using the criteria outlined understand how Wesfarmers limited during the period 1 July 2010 to 30 June in the AA1000 Assurance Principles and each of the business divisions is 2011. Wesfarmers Group and Wesfarmers’ Standard (2008), while assessment of addressing key sustainability challenges business divisions were responsible for the the accuracy and quality of sustainability and how sustainability is integrated within preparation of the Report and this statement performance information was undertaken the organisation. represents the assurance provider’s using Wesfarmers’ indicator protocols and • Independent engagement with independent opinion. Net Balance’s the Global Reporting Initiative’s (GRI) G3 stakeholders of Wesfarmers limited responsibility in performing its assurance Reporting Principles for Defining Quality. at a corporate level and a review of activities is to the Board of Directors and Assurance Level and Limitations stakeholder engagement activities management of Wesfarmers alone and in undertaken by each of the business accordance with the terms of reference The level of assurance provided is moderate, as defined by the scope and divisions. This included reviewing how agreed with them. Other stakeholders stakeholder engagement informs the should perform their own due diligence methodology described in this assurance statement. The assurance covered the sustainability strategy and performance before taking any action as a result of of the organisation. this statement. whole of the Report and focused on systems and activities of Wesfarmers during • A review of the key sustainability Assurance Standard and Objectives the reporting period, with the following strategies, policies, objectives, The assurance process was undertaken exceptions: management systems, measurement in accordance with the AA1000 2008 • The scope of work did not involve and reporting procedures used by Assurance Standard (AA1000AS). The verification of financial data, other than Wesfarmers Group and each of the standard provides a comprehensive way that relating to environmental, social or business divisions. of ensuring an organisation is responsible broader economic performance. • Interviews with key personnel responsible for the management, performance and for the Report to ascertain their views, reporting of its sustainability issues. This • Assurance of Scope 1 and 2 understanding and response to material is achieved through evaluation of the greenhouse gas emissions reportable sustainability issues faced by the business organisation’s adherence to the AA1000 under the national Greenhouse and divisions. AccountAbility Principles (2008) and energy Reporting (nGeR) legislation by reviewing the reliability and quality was undertaken by another external • Interviews with key personnel responsible of disclosed sustainability performance consultant. this work was not replicated for collating and writing various parts of information. and Net Balance’s opinion in the area the Report to substantiate the reliability of greenhouse gas emissions relies in of selected claims. Representatives The AA1000 AccountAbility Principles part on the assurance opinion issued of each of the wholly-owned business (2008) used to assess Wesfarmers’ by the other party. Net Balance’s divisions were interviewed by members processes include: assurance of greenhouse gas emissions of the assurance team as part of a series inclusivity: An assessment is made as covered all other data not reported of site visits. Interviews were conducted under the nGeR legislation (scope 3 to whether the organisation has included with representatives of Bunnings, Coles, emissions, non-Australian operations, stakeholders in developing and achieving Curragh Coal, industrial and safety, and operations outside of Wesfarmers’ an accountable and strategic response Insurance, Kmart, Officeworks, Premier operational control for the purposes of to sustainability. Coal, target, and Wesfarmers Chemicals, the legislation). materiality: An assessment is made as Energy & Fertilisers. In addition, interviews • Assurance of detailed community to whether the organisation has included were also conducted with representatives contributions data for all divisions in its report the material information and of Wesfarmers Group. except Home Improvement and Office data required by its stakeholders to make supplies was undertaken by london • A review of the Report for any significant informed judgements, decisions and benchmarking Group. Community anomalies, particularly in relation to claims actions. contributions data by Home Improvement as well as trends in data. responsiveness: An assessment is and Office Supplies was reviewed as part • Verification of more than 240 data points made as to whether the organisation has of Net Balance’s assurance process. and statements selected from the Report responded to stakeholder concerns, policies and examination of the systems and and relevant standards and adequately Assurance Methodology processes that support the claims. communicated these in its report. The assurance engagement was undertaken between June and October • Collecting and evaluating evidence to Assurance Type and Scope 2011, and involved: support the assurance work undertaken. Net Balance provided Type 2 assurance • Preparation of a materiality register (list • A Global Reporting Initiative (GRI) G3 in accordance with the AA1000AS (2008). of key sustainability issues) using the Application Level Assessment. five-part materiality test. This included

70 Wesfarmers sustainability RepoRt 2011 Our Independence and result in a prioritisation of issues that detail on the organisation’s progress in Net Balance was not responsible for is clear and replicable. Notwithstanding, addressing company-wide issues. While preparing any part of the Report. During Wesfarmers appears to have appropriately the consistency and completeness of the reporting period Net Balance has addressed its key environmental, social and core indicators is now high, continued assisted in the development of data economic material issues in a balanced effort is required in the areas of Scope 3 management forms for Wesfarmers to way. To ensure that the key themes used to greenhouse gas emissions, waste and increase consistency in reporting between structure the report reflect the organisation’s management figures. the business divisions. Net Balance has material risks, these should be reviewed Given Wesfarmers’ diverse operations, also worked with Bunnings, Officeworks and updated on a regular basis. To illustrate, the challenge is to foster a Group-wide and Kmart on on-ground implementation themes identified by stakeholders as approach to the integration and importance projects. Both Wesfarmers and Net Balance important (eg. sourcing and customers) of sustainability in strategy development and have determined that these projects are are not always adequately covered by execution. Net Balance understands that a not in conflict with Net Balance’s role as the framework. Group Sustainability Policy is currently under the independent assurance provider. responsiveness: development. To support this document, Our Competency In general, Wesfarmers appears to address Wesfarmers should also consider The Wesfarmers assurance engagement the needs, concerns and expectations developing a Group Reporting Methodology. was carried out by an experienced team of of its stakeholders in a timely fashion. This document could provide guidance to professionals led by two Lead Sustainability This was demonstrated through a range divisions on principles and processes for Assurance Practitioners (Lead CSAP). The of formal and informal communication stakeholder engagement, including how project included personnel with expertise mechanisms. Responsibility for developing to use stakeholder feedback to inform the in environmental, social and economic responses appears to spread across the corporate planning process; as well as a performance measurement across a range organisation (and across divisions) and in process for materiality assessment which of industry sectors. Net Balance is a global several instances it was clear that material links to the corporate planning process leader in the use of the AA1000AS, having issues are considered as part of the regular and results in a prioritisation of issues undertaken more than 100 assurance business planning processes. In some that is clear and replicable. Wesfarmers engagements in Australia over the past cases, however, Wesfarmers’ response to should also continue to respond to issues five years. issues concentrated only on a single facet raised through its own engagement such of the issue. Wesfarmers should focus as requests for inclusion of information on Findings and Conclusions on considering the full range of impacts targets, prioritisation of sustainability issues, Adherence to AA1000 Principles associated with a particular issue in order links between sustainability and business inclusivity: to ensure that it provides a comprehensive strategies and people management. Wesfarmers demonstrates its commitment and balanced response to stakeholder With an increased focus on materiality and to be accountable to its stakeholders issues raised. stakeholder engagement at the business through its Company Values and reliability of Performance information division level, it is also recommended that the sustainability reporting process. Wesfarmers undertakes assurance against Based on the scope of the assurance Responsibility for engaging with the principles at the business division level process, the following was observed with stakeholders rests primarily at the business in addition to the Group level. Net Balance regard to performance information: division level. As a consequence, there is believes that this will assist business variation across Wesfarmers in the extent • The findings of the assurance divisions to better focus on their key material and quality of engagement undertaken. engagement provide confidence in the and stakeholder considerations. There are examples of innovative and underlying systems and processes used In order to continue to improve the proactive engagement in the business for managing and reporting sustainability usefulness of future reports to stakeholders, (eg. ‘Tell Coles’ and Bunnings’ engagement performance information. Net Balance encourages Wesfarmers to with Timber suppliers), however, there • Data trails selected were generally give some issues more context in the report are also examples where engagement is identifiable and traceable, and the and to consider whether each statement more reactive and the business is missing personnel responsible were able to is material to stakeholders and what the opportunities to genuinely engage directly reliably demonstrate the origin(s) and results mean for the business. Wesfarmers with stakeholders. This could be overcome interpretation of data. should also ensure that its commitments by making engagement more systematic. In and targets are ‘SMART’ – specific, the future, Wesfarmers should work to map • The sustainability performance measureable, attainable, relevant, time- its key stakeholders and use the stakeholder disclosures presented within the Report bound – to enable progress against these feedback to better inform its strategic appropriately reflect environmental, social commitments to be more easily monitored. planning and decision-making at both the and economic performance achieved Group and business division levels. during the period. Net Balance has provided additional suggestions for reporting improvement materiality: • The GRI Application Level check in the Assurance Report presented to Wesfarmers has this year again reported classified the Report as Level B+. Wesfarmers’ management. in line with five key themes. These were Overall, it is Net Balance’s opinion that the developed in consultation with the business information presented within the Report On behalf of the assurance team divisions to reflect the range of impacts is fair in all material respects. The Report 18 October 2011 of Wesfarmers’ businesses. In parallel was found to present a reliable account Melbourne, Australia with this process, we understand that the of Wesfarmers’ sustainability performance issues covered in the report partly reflect during the reporting period. those identified through the corporate planning process. In future reporting The Way Forward periods, it is recommended that decisions Over the past 12 months, Wesfarmers has David Simpson relating to the report content more closely made significant progress in presenting a Lead CSAP align to the corporate planning process. consolidated view of Group performance Further, consistent with the current trend within the Sustainability Report. Building of Wesfarmers’ business divisions towards upon a strong foundation of a core set reporting that focuses on their specific of indicators, Wesfarmers has continued Kim Farrant material issues, this process should be to expand upon the reporting of Group Associate Director, Net Balance carried out at the business division level level issues and performance, providing Lead CSAP

Wesfarmers sustainability RepoRt 2011 71 Glossary

This glossary contains an explanation of terms used several times in the text of this report.

Australian Packaging Covenant (APC): Gigalitre: Petajoule: An agreement between governments, A measure of volume equal to one A measure of energy equal to one the packaging industry, retailers and billion litres million gigajoules consumer brand owners, which sets guidelines through annual plans and Greenhouse gases: Total Recorded Injury Frequency public reporting for resource conservation Gases such as carbon dioxide, methane, Rate (TRIFR): and waste reduction in the manufacture, nitrous oxide and sulphur hexafluoride A measure commonly used to report supply, distribution, consumption and which contribute to the retention of heat workplace safety performance, which is recovery/recycling of consumer packaging in the earth’s lower atmosphere calculated by dividing the number of LTIs and Medical Treatment Injuries by the total Australian Standards: Liquefied Petroleum Gas (LPG): hours worked, multiplied by one million National benchmarks for products Comprising predominantly propane and and services butane extracted from natural gas or as Wesfarmers Greenhouse and Energy a by-product of petroleum refining Reporting System (WesGERS):

Carbon dioxide equivalent (CO2e): Our internal internet-based reporting system A standard method for converting the Liquefied Natural Gas (LNG): used by Wesfarmers to monitor and report global warming potential of all greenhouse Comprising predominantly methane, LNG on all greenhouse emissions and energy gases to a standard unit related to the is produced from natural gas that has been used and produced global warming potential of carbon dioxide purified, refrigerated and condensed to liquid form Energy Efficiency Opportunities Act 2006 (EEO): Lost Time Injury (LTI): This legislation is Australian Federal A work-caused injury which results in an legislation designed to require large energy absence for one day (or work shift) or more users to develop and report on energy efficiency initiatives in their business Lost Time Injury Frequency Rate (LTIFR): Forest Stewardship Council (FSC): A measure commonly used to report This Council is an independent, non- workplace safety performance which is governmental, not-for-profit organisation calculated by dividing the number of LTIs established to promote the responsible by the total hours worked, multiplied by management of the world’s forests one million

Fugitive emissions: National Greenhouse and Energy Generally deliberate but not fully controlled Reporting Act 2007 (NGER Act): (or in all cases avoidable) emissions that This Act governs the public reporting of typically result from leaks from pumps, energy use and greenhouse emissions pipes and valves, coal seam methane or by large organisations in Australia vapours emitted when large hydrocarbon storage tanks are filled

72 Wesfarmers sustainability RepoRt 2011 Group structure

RETAIL INDUSTRIAL AND OTHER BUSINESSES

Home Chemicals, Industrial Other Coles Improvement Target Kmart Insurance Resources Energy and and Safety activities and Office Fertilisers Supplies

COLES/BILO TARGET CURRAGH CSBP BUNNINGS KMART AUSTRALIA AUSTRALIA GRESHAM (AUST/NZ) (AUST/NZ) LUMLEY BLACKWOODS PARTNERS (50%) COLES TARGET INSURANCE PREMIER AUSTRALIAN BULLIVANTS 1 EXPRESS OFFICEWORKS COUNTRY COAL GOLD KMART TYRE WFI COREGAS REAGENTS & AUTO OAMPS (75%) TOTAL WESPINE LIQUORLAND HARRIS URBAN SERVICE PREMIER FASTENERS INDUSTRIES TECHNOLOGY BY TARGET POWER NEW ZEALAND PROTECTOR (50%) VINTAGE SALES ALSAFE LUMLEY QUEENSLAND CELLARS NITRATES CROMBIE (50%) BWP TRUST LOCKWOOD BENGALLA NEW ZEALAND (23%) 1ST CHOICE (40%) BLACKWOODS LIQUOR AUSTRALIAN PAYKELS OAMPS UK VINYLS PROTECTOR COLES NZ SAFETY ONLINE AIR LIQUIDE PACKAGING WA (40%) HOUSE HOTELS SAFETY SOURCE KLEENHEAT GAS

ENGEN2

1 In September 2011, Wesfarmers announced the sale of Premier Coal for $296.8 million. 2 On 31 August 2011, Wesfarmers completed the sale of enGen for $101 million.

WESFARMERS LIMITED ABN 28 008 984 049 Level 11, Wesfarmers House 40 The Esplanade, Perth, Western Australia 6000

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